What does CDW really cover?
Collision Damage Waiver (CDW or LDW in the US) does not equate to comprehensive car insurance as we know it in Australia – even when it is advertised as “fully comprehensive”. A waiver is a contractual term where the rental company waives its right to claim compensation from the customer for damage to the rented vehicle. The consumer will still be liable to pay a hefty “excess”, often as much as $2,500… or even more.
As the wording implies CDW is principally designed to cover damage caused in a collision with another vehicle and not single-vehicle damage. In the past, both types of damage would have been covered – as long as the driver had not been particularly negligent. Today, as budget car rental firms look for savings, the scope of CDW cover has shrunk and new exclusions hide in the small print.
A good car rental firm will provide cover if, for example, the car is damaged by driving over a rock on a bend in the road, or if it skids on an oily road and hits a wall; a cheapskate company will try to claim negligence on the part of the driver and charge for the full cost of such damage, which can run into thousands of pounds.
In any event, the basic CDW cover usually excludes damage to tyres, wheels, wing-mirrors, windows, hubcaps, the undercarriage and roof of car. It also excludes towing costs in the case of breakdown and clutch failure – even if you have only driven a few miles.