When considering Motorhome Hire, some travellers can get confused with the Standard Insurance Liability and what is meant by this.
The majority of Motorhome Hire rates that you see advertised include what is known as a standard insurance liability of AU$7,500 or AU$5,000. (less for some vehicle options)
- This means, should there be damage to your Motorhome Hire, then you responsible for the first AU$7,500 (or the amount of the standard liability for that vehicle) of repairing the damage (please note per incident, not per hire – if you are incredibly unlucky).
- Please also note, should there be an incident which is not your fault, then the supplier of the motorhome hire (ie Apollo or Britz for example) would retain the cost to fix the vehicle, until the money was received from the third party’s insurance company, which could take up to a month or two, maybe longer. In Australia, it is compulsory that everyone has at least third party insurance.
- If you choose the ‘standard rate’ with your motorhome hire, then there is also a bond (refundable security deposit), charged to your credit card at time of pick up. The bond can only be paid by credit card, is for the amount of the liability, ie AU$7,500 (or equal to that of the liability amount). For a lot of people this is more than they have available on their credit card, remembering if there is an accident this money could be tied up for a period of time. Alternatively, when you return the vehicle at the end of the trip with no damage, in line with the terms and conditions (toilet etc emptied), then the bond is refunded back to your credit card. There could be an exchange rate risk when the money is returned to the card as this is charged in Australian dollars.
Reducing your Insurance Liability and Bond
- You can choose to reduce the insurance liability partially with some of the Motorhome Hire Options (to AU$2,500 bond and liability), or can fully reduce to a $0 insurance liability with a AU$250 bond by paying a higher daily rate. When the bond is AU$250, this is a ‘swipe’ against the credit card, rather than a charge, so there will be no exchange rate risk. As long as you bring back the vehicle in line with the terms and conditions (toilet etc emptied), this is not actually charged to the card – the funds do need to be available.
- If you choose to reduce the liability to AU$0, then the extra cost is not refunded at the end of your holiday (it is like paying your car insurance at home for example)
- We recommend taking the $0 insurance liability (usually referred to as Liability Option Two with some of our suppliers) for peace of mind travel
- The $0 insurance liability also covers you for overhead and under body damage with some of our suppliers (not covered with other insurance options), as well as providing cover for accidental damage to tyres and windscreens (limits with some suppliers)
- Please take the time to read the terms and conditions, which detail the exclusions for liability cover for your specific motorhome hire, as under body and overhead damage (ie drive into a tree) is not covered with all suppliers when reducing the insurance liability.
Gallivanting Oz will provide more information on your specific motorhome hire needs, as there is a variation with standard terms. This information is general in nature to give you a basic understanding.
The amount of the standard insurance liability does vary amongst our suppliers from as little as AU$1,000 to AU$7,500 depending on your vehicle choice.
- Our older range of motorhome hire (with shower/toilet) range from AU$2,700 to AU$5,000 with their standard insurance liability option
With all of the options, the charges for reducing the insurance liability are capped at a certain number of days, like 35 or 50 days (depending on the supplier of your motorhome hire), with the remaining days covered for free. This can be a good benefit when travelling for a longer period of time.
The additional rates vary depending which motorhome hire you are choosing, and also which liability reduction option you will choose. This can also be part of an ‘inclusive package’ which also provides additional items like the one way hire fee, camping table and chairs, or you can simply just take the $0 insurance liability option with some vehicles too.
For a basic example, the motorhome hire (Britz in this example) may cost AU $100 per day with AU $7,500 liability/bond. The same vehicle would cost
- $129 per day with Liability Option One – $2,500 insurance liability/AU$2,500 bond (bond charged to credit card at time of pick up)
- $145 per day with Liability Option Two – $0 insurance liability/AU$250 bond (bond is a swipe on credit card)
- $165 per day for the inclusive package, with Liability Option Two ($0 insurance liability/AU$250 bond) included and many extras
- the cost to reduce the insurance liability in this example is capped at 50 days, with the remaining days covered for free
Which is the best option?
The amount of funds available on your credit card, length of hire and your peace of mind are all factors to consider in determining the amount of liability that is appropriate for you.
Gallivanting Oz can assist with specifics in terms of insurance costs for our suppliers, and the best option for your personal situation. Let us know if you would like to find out more about camper hire Australia, or if we can provide a Campervan Hire Quote for your upcoming adventure.