The 10 most common rental-car charges and how to avoid them

EU rules now state that car rental companies must be transparent about all charges and list them, so customers know what they’re paying for. But why pay more than you should? Here’s how to avoid extra charges.

EU rules now state that car rental companies must be transparent about all charges and list them, so customers know what they’re paying for. But why pay more than you should? Here’s how to avoid extra charges.

Coronavirus (COVID-19) update: please check the latest government travel advice that sets out what you need to do, if anything, before you travel abroad and before you return home. You should also check the latest travel advice and entry requirements for each country you visit or transit through. Travel rules can change at short notice, so check the Foreign, Commonwealth & Development Office (FCDO) for the latest information.

Josh Daniels
Travel Insurance expert
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Posted 2 JUNE 2020 Last Updated 31 MAY 2021

No more hidden charges

After years of customers facing confusion around hidden charges for holiday car rentals, companies were told in 2019 to change their ways to fully comply with EU rules. Car rental services are now required to clearly list all charges. But why pay more for your car rental than you should?

Here’s a look at the 10 most common extra charges when hiring a car, and how you can avoid them.


What extra charges are there for holiday hire cars?

As well as the standard rental agreement, you may be expected to pay some, or all, of the following:

  • Insurance charge
  • Upgrade charge
  • Damage charge
  • Extra day charges
  • Admin charges
  • Young or old drivers charge
  • Rental equipment charges
  • Fuel charges
  • Toll charges
  • Road tax charges

1. Insurance charges

Basic insurance that meets national or European law is included when you hire a car abroad. However, this usually comes with a hefty excess – sometimes as much as £2,000 – which you’d have to pay if the car is damaged or stolen, no matter who is at fault.

When you go to pick up your car, you’ll likely be offered an add-on called a ‘super collision damage waiver’. It’s designed to bring the excess down, but is expensive.

How can I avoid car rental insurance charges?

If you’re travelling in the EU, bear in mind that all car rentals have basic collision damage waiver and theft protection included, so you don’t have to buy the extra ‘super’ insurance upgrade if you don’t want to.

If you’d prefer the extra protection, consider buying an Excess Reimbursement Insurance (ERI) policy from a standalone insurance provider instead. It can be bought online, ahead of your trip and is usually much cheaper than cover offered by rental companies.

Rental car insurance extras are littered with jargon and can be confusing. Be sure to check what’s in your standard rental agreement and get the counter staff to explain it clearly, so you’re not buying something extra you don’t need. For example, Personal Accident Insurance (PAI) which covers you and your passengers for injuries, is usually included in your travel insurance. Personal Effects Coverage (PEC), which covers personal belongings in the car, may also be covered by your travel or home insurance. Check with your providers to find out ahead of time.

If you do decide to buy a ‘super’ waiver at the counter, check that the cost is for the whole trip, and not per day.

2. Upgrade charge

This is simply an offer to upgrade to a better car than the one you’ve agreed to rent. “Better” could mean a bigger or more luxurious vehicle, or one with extra features. This type of charge is purely optional. If you decide to upgrade, check the total price, as some charges can be made at a daily rate.

How can I avoid an upgrade charge?

It might be tempting, but do you really need an upgrade? If the car you originally booked suits your needs, it might be better to stick to that, especially if it’s smaller and easier to park. Be aware that a bigger, fancier car may come with a higher excess and security deposit.

3. Damage charge

When you return your rental car, the rental company will check for any damage that wasn’t there before you hired it. If they find anything, you’ll be charged for the cost of repairs. You should check your rental agreement carefully to find out how much you’ll be charged for different types of damage.

How can I avoid damage charges?

The most obvious tip is to simply not damage the vehicle, but that’s perhaps easier said than done. Drive responsibly, as if the car was your own, and park it in a safe place, particularly overnight.

A good tip to avoid being charged for damage that isn’t your fault? Carefully examine the car before you drive away. Point out any existing damage or scuffs to the rental company, and make sure they’re noted. Take pictures if necessary. That way, you won’t be paying for anyone else’s bad driving.

4. Charge for extra days

Your rental agreement will be for a fixed number of days, usually at a daily or weekly rate. If you’re late returning the vehicle, you’ll be charged a pre-agreed fee.

Car rentals work in 24-hour periods, so if your rental agreement begins at 11am on the day of pick up, it needs to be returned by 11am on the agreed return day. If you bring the car back in the afternoon of the right day, you’ll likely be charged for a full extra day.

How can I avoid charges for extra days?

To avoid being caught out, read your agreement carefully, and find out the cut-off point for an extra day. If you need to drop the car off later than planned, contact the rental company and find out how much it will cost, before turning up late.

5. Admin fees

Admin or processing fees are commonly charged by car rental companies if they have to deal with any issues from your rental. For example, passing on speeding or parking fines, sorting out damage repairs, or cleaning the car once it’s returned or refuelling.

How can I avoid admin fees?

You won’t be able to avoid admin fees for things like traffic fines or damage if you’re responsible. But if you’ve been unfairly charged and can prove it, you can contact car rental company and dispute the extra admin charge.

6. Charges for young or senior drivers

Younger and older drivers may face an extra charge because of their age. This is because they’re considered a higher risk. Ages can vary from one rental company to the next, but, if you’re under 25, or over 65, it’s always worth checking your agreement carefully for this extra fee.

How can I avoid charges for young or senior drivers?

It’s worth shopping around with different providers. If you’re 24, for example, one provider may classify you as a young driver, but another may not. Senior driver fees are easier to avoid as many rental companies don’t charge them. Check the terms and conditions before you book. If there’s a charge, look elsewhere. You might just save yourself an extra fee.

Choosing a smaller car might also help keep the costs down. Bigger, more powerful cars usually come with stricter age restrictions.

7. Rental equipment charges

Most rental companies will charge you for renting extra equipment like child car seats or a sat nav.

As child car seats are legally required in most countries around the world, you’d think they’d be fitted as standard when renting a car with small children. Unfortunately not. Even booster seats can come with an extra charge.

How can I avoid rental equipment charges?
Most airlines let you carry your child seat for free, so take your own and save yourself a fee. Just make sure you can use a UK car seat in the country you’re driving in. For example, in Canada, child car seats must have the Canadian National Safety Mark, so you’ll have no choice but to rent one there.

As for sat nav – who doesn’t have a smartphone or iPhone these days? There a whole load of navigation apps available for download on Android and iOS devices. Some, like Google Maps, are free – although you might have to pay data roaming charges, depending on your mobile plan.

8. Fuel charges

Fuel charges are simply paying for the fuel you use while renting the car. Most rental providers have a full-to-full policy, which means that they’ll hand the car over to you with a full tank of fuel, with the expectation that you’ll return the car with a full tank. If you don’t, you’ll face a charge for the hire company having to refuel it themselves. This is usually at a more expensive rate than simply filling it up yourself.

Make sure you’re clear on the rental-company’s fuel policy before you pick up the car.

How do I avoid extra fuel charges?

If you stick to the fuel policy, you won’t be charged extra, simple as that.

Some rental companies give you the option of returning the tank empty and they’ll refill it for you when you return the car. It may seem like less hassle, but it typically costs more, so you’re better off filling the tank yourself.

Top refuelling tip

If you’re picking up and returning your rental car from an airport location, try to avoid the on-site fuel stations as they tend to charge more. Do your research and use a fuel station within a few miles of the airport where you’ll typically pay less per litre.

9. Toll charges

While you’re responsible for the car, you’ll need to pay any toll charges while driving. Many toll roads have barriers and a booth, so you can pay the toll in cash, no problem.

But some tolls are electronic. There’s no barrier, so you might drive through without realising. The vehicle will be registered when you pass through the toll and the local traffic authorities will ask the rental company for your details so they can send you a fine. If this happens, you’ll end up paying both the fine and an admin fee from the rental company.

How can I avoid toll charges?

When you pick up the car, ask about local tolls and how they work. It’s also a good idea to have some local currency to hand, so you can pay at cash booths. In some countries, like Australia where all tolls are electronic, you can buy a ‘toll pass’ online, either before you travel or within three days of travelling on the toll road.

10. Tax charges

Tax charges vary from country to country, so it’s best to read your agreement carefully, and be aware of any added tax. This may be included in your rental or added as an extra.

How can I avoid tax charges?

This is one charge you can’t avoid. Any taxes added by the state will have to be paid. All you can do is check the terms and conditions, so you know how much you’ll be expected to pay.

What if I use my own car?

If you’re taking your own car over to Europe, you’ll need to check your car insurance policy to see if you’ll have the same level of cover as you have in the UK. All UK car insurance policies have the minimum third-party cover for driving in the EU. But if you have a comprehensive policy in the UK, don’t just automatically assume you’ll have the same level of cover for driving abroad.

Since Brexit, you’ll also need a green card if you’re driving your own car in Europe. It’s an international certificate of insurance and proves that you’re adequately insured. You can ask for a green card from your car insurance provider.

Depending on the countries you’re driving in, you might also need an International Driving Permit.

And last but not least, whether you’re hiring a car or taking your own, make sure you have travel insurance.

Luckily, you can do that right here – whether you’re travelling alone, as a couple or taking the whole family.

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