The staggering amount of money wasted by businesses on car hire excess insurance in Europe has been revealed
Each year £599 million is spent by corporate customers on excess cover for rental vehicles across the continent, according to research by iCarhireinsurance.com, the provider of low-cost, comprehensive excess car hire insurance.
This really is a hidden cost of business travel. Whilst businesses are managing to cut costs on flights, hotels and car hire, car hire excess insurance is still bought at the car rental desks by employees and claimed back through expenses. This can make it difficult for their managers to notice how much these costs add up.
Huge sums could be saved if cover was simply bought before employees arrive at the car rental desk. The study discovered that businesses could be a remarkable £420 million better off each year if they simply planned ahead, and bought their well-travelled employees excess insurance before they pick up their hire car.
iCarhireinsurance.com’s European daily excess policy costs just £2.99 a day. The average price charged by car rental desks across the continent for this cover is £9.99* a day, so businesses could save £7 a day, and a massive £420 million across Europe. If employees drive hire cars for more than 14 days a year businesses would be better off purchasing them an annual policy at only £39.99. It is also a good bonus for employees, as it will cover them for their personal travel as well.
Not only are iCarhireinsurance.com’s products cheaper, they are more comprehensive than those sold at car rental desks, with drivers benefiting from cover that is excluded from most other policies. Drivers will be insured if their hire car is damaged or stolen, but also covered for damage to the roof, tyres, windows and undercarriage, and for driving within 150km of their home.
The corporate car rental market in Europe is estimated to be worth around £4.4 billion and the average price per day of car rental is £33 which means that there will have been 133 million business car rental days this year. It is estimated by the industry that 45% of drivers take out excess cover. As the average price charged by car rental desks across the continent for this cover is £9.99 a day, this means that £599 million will be spent this year. However as employees can claim excess insurance back from their employer, and are unlikely to want to be liable for damage on a work trip, it is expected that more than 45% of business users take out this over, making the overall spend significantly higher than we have estimated.
Ernesto Suarez, founder and CEO of iCarhireinsurance.com said, “This really is the hidden cost of business travel. If employees have to use hire cars for your company, you could save a lot of money by buying cover for them before they reach the rental desk. Excess cover is important when hiring cars abroad because most rental companies have an excess of between £500 and £1500, however the cost of excess insurance can really add up. We offer an alternative and the amount of money that could be saved is astonishing.”
*Prices correct at August 2010.