Do I Need Rental Car Excess Insurance or Is Hire Cover Enough in 2026?

Short answer. In Australia in 2026, you don't have to buy rental car excess insurance, but the hire company's included cover usually still leaves you owing a large excess if the car is damaged or stolen. Avis, for example, lists a standard excess of $5,900 for small to large cars, which its optional Excess Reduction lowers to $1,500 and Zero Excess lowers to $0, according to Avis at the time of writing. If you couldn't comfortably pay the standard excess, reduce it.

New to ShopBack? ShopBack Australia is a free app and website that gives you money back when you book or buy through it, including car hire on Discover Cars and travel policies from Cover-More and Fast Cover. You open the store from ShopBack, book or buy as usual, and part of the eligible amount comes back to your account as cash. Join ShopBack Australia free before you book.

Figures below come from Avis Australia's coverage options page, Cover-More's plan comparison, Fast Cover's cover options, Compare the Market's travel insurance guide and Discover Cars' booking pages, at the time of writing in October 2026. Prices change, so check the live details on the day.

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Do I need rental car excess insurance, or is the hire company's cover enough?

The hire company's included cover is enough only if you could pay the full excess without trouble. Most rentals already include basic damage cover, but it comes with an excess, the amount you still owe if the car is damaged or stolen. Avis says that in Australia, if your rental vehicle is involved in an accident, an excess generally applies.

You have four ways to handle it:

Option	What it does	Where you buy it
Keep the standard cover	You owe up to the full excess if something happens	Included in the rental
Hire company excess reduction	Lowers what you owe, sometimes to $0	At booking or at the counter
Travel insurance with rental vehicle excess	Pays you back up to a limit after a claim	From a travel insurer before you go
Cover bought with the car booking	Separate protection chosen when you book	From the booking site, such as Discover Cars Full Coverage

A quick test. Look at the excess on your booking. If paying that amount next week would hurt, reduce it with one of the three options. If it wouldn't, the included cover may be all you need, as long as you are comfortable with that risk.

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How hire company cover works in Australia: the Avis example

Hire companies set the excess by vehicle type and sell options that lower it. Avis publishes its amounts, which makes it a useful example:

Avis vehicle size	Standard excess (Loss Damage Waiver)	With Excess Reduction	With Zero Excess
Small to large cars	$5,900	$1,500	$0
Four wheel drive and luxury vehicles	$6,900	$2,500	$0
Avis Signature Series	$7,900	$2,500	$0

Source: Avis Australia's coverage options page, at the time of writing. Avis says amounts include the admin fee, credit card surcharge and GST.

A few details matter as much as the numbers:

• What is excluded. Avis says its Loss Damage Waiver, Excess Reduction and Zero Excess do not cover certain types of loss or damage, including overhead, underbody and water damage.
• Availability. Avis says Zero Excess is not available at all locations or on commercial vehicles.
• Fair wear and tear. Avis publishes a Fair Wear and Tear Guide that separates reasonable wear from damage you would pay for.

Other hire companies, such as Budget and Europcar, set their own excess amounts and options, so check them on your booking.

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Insurance for rental cars: how the options compare

The real difference between the options is when you pay and how you get money back.

• Hire company excess reduction. You pay a daily charge and your liability drops at the source. If the car is damaged, there is usually nothing to claim back. The cost adds up over a long rental.
• Travel insurance. The cover sits inside a policy that also covers things like medical costs, luggage and cancellations on an overseas trip. You usually pay the hire company first and then claim. Cover-More says it pays the cost of the insurance excess or the repair costs you're liable for, whichever is lower, and that you need to get a final loss or repair report so it can assess the claim.
• Cover bought with the booking. Booking sites such as Discover Cars let you choose their own protection when you book the car. It is tied to that rental, and the claim process sits with the provider of that cover.

Compare the Market's travel insurance guide suggests that if you plan on renting a car, rental vehicle insurance excess cover would be a good idea, and lists rental vehicle excess among the common inclusions of overseas policies.

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Insurance for rental cars in Australia 2026: what travel policies include

Many Australian travel policies include rental vehicle excess cover, but the limit depends on the plan.

Cover-More. On its international plans, Cover-More lists rental vehicle insurance excess cover of:

• International Basic: not included ($Nil)
• International Comprehensive: up to $5,000
• International Comprehensive+: up to $10,000

Cover-More says it covers the insurance excess or the vehicle repair costs you're liable for, whichever is lower, if the rental vehicle is damaged or stolen while in your control during your trip. Its domestic plan comparison also lists a rental vehicle insurance excess benefit. Full terms, limits and exclusions are in the Driving Holidays section of the Product Disclosure Statement (PDS).

Fast Cover. Fast Cover lists rental vehicle excess as an optional cover that helps cover your rental vehicle insurance excess costs. Check the PDS for the limit on the plan you choose.

What to check against your rental:

1. The excess on your rental agreement.
2. The rental vehicle excess limit on your travel policy. If it is lower than the excess, you would pay the gap.
3. The vehicle types and driving covered, such as unsealed roads or campervans, in the PDS.
4. Whether you need to be named as the driver on the rental agreement.

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Insurance for rental cars best deals in Australia 2026: how to pay less

The best deal is the option that covers your excess for the lowest total cost across the whole trip. Here is a worked example with illustrative prices (not real quotes) for a 7 day rental:

Option	Illustrative cost	Covers
Hire company excess reduction at $30 a day	$210	Lowers the excess on this rental only
Travel policy that already includes rental excess cover	$0 more than the policy you were buying anyway	Up to the policy's limit, after a claim
Separate cover bought with the booking	$80	This rental, after a claim

In this example, if you were already buying a travel policy for the trip with enough rental excess cover, the counter option would cost $210 for protection you already have. On a short domestic rental with no other travel insurance, the sums can come out differently, so price each option for your own trip.

Ways to keep the cost down:

• Check your existing travel policy first. You may already have rental vehicle excess cover.
• Match the limit to the excess. A policy limit lower than the excess leaves you paying the difference.
• Book with free cancellation where you can. Discover Cars says you can cancel deals that offer it for a full refund up to 48 hours before your pick-up time.
• Take photos at pick-up and drop-off. Record any existing marks so they are not put down to you.
• Go through ShopBack before you pay. This lowers the effective price of eligible car hire and travel policies, as explained below.

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Discover Cars vs Cover-More for rental car insurance: price comparison 2026

Discover Cars and Cover-More solve the same excess problem in different ways, so compare them on what each covers for your trip.

What to compare	Discover Cars Full Coverage	Cover-More travel policy
What you buy	Protection chosen with one car rental	A travel policy that can include rental vehicle excess cover
What else it covers	That rental	Depends on the plan, such as medical costs, luggage and cancellations
Excess limit	Set out when you book	Up to $5,000 on International Comprehensive and $10,000 on Comprehensive+, per Cover-More

Source: Cover-More's plan comparison, at the time of writing.

A price comparison you can run yourself. Get the Discover Cars total with and without Full Coverage for your dates, then get a Cover-More quote for the same trip on a plan with enough rental excess cover. If you need travel insurance for the trip anyway, compare the travel policy's price with and without the higher plan, not the full premium.

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Discover Cars, Cover-More and Fast Cover: which suits which trip

• A road trip in Australia, with no other travel risks to insure. Compare the hire company's excess reduction, Discover Cars Full Coverage and a domestic travel policy for the same dates.
• An overseas trip with a hire car. A travel policy such as Cover-More or Fast Cover covers the car excess along with the rest of the trip, as long as the limit is high enough.
• A long rental. Daily charges add up, so cover bought once per trip often deserves a closer look.

For travel insurance more broadly, Australians also compare insurers such as InsureandGo and Southern Cross Travel Insurance, or use a comparison service such as Compare the Market. For car hire, Avis, Budget and Europcar sell direct, and Discover Cars compares deals from many suppliers.

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Before you sign the rental agreement: a pick-up checklist

1. Read the excess on the agreement, not just the booking summary.
2. Decline or accept the counter offer on purpose. If you already have cover, you may not need the hire company's reduction.
3. Check what is excluded, such as underbody, overhead and water damage on Avis rentals.
4. Photograph the car, inside and out, including the windscreen and wheels.
5. Keep every document. If you need to claim on separate cover, the insurer will usually ask for the rental agreement and a final loss or repair report.

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How ShopBack lowers the cost of car hire and excess cover

Booking through ShopBack lowers the cost of the trip, and you still book on the site you chose. Before you check out, go through ShopBack to get a post-purchase discount on the order.

Cashback lowers what you actually pay for an order. It comes back as cash, so it works like a discount on the price, not like points or miles. Once it confirms, you can withdraw it to your bank account.

Step by step:

1. Open ShopBack Australia (app or website) and search for Discover Cars, Cover-More or Fast Cover.
2. Check the rate shown on that page.
3. Tap through and book the car or buy the policy.
4. Cashback shows as pending in your ShopBack account soon after you pay, and confirms after your trip.

What it really costs. Your effective price is what you pay minus the cash ShopBack returns. The live rate is the one shown on each store's ShopBack page on the day.

For more on doing this every time, see how to activate ShopBack before you buy.

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Promo codes and ShopBack on car hire and travel insurance

No code needed: go through ShopBack before you pay and part of what you spend comes back as Cashback. Compare the price of each option for your trip, then book or buy from the store's ShopBack page.

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Key takeaways

• You don't have to buy excess insurance, but included hire cover usually leaves a large excess; Avis lists $5,900 for small to large cars.
• If you couldn't comfortably pay the excess, reduce it at the counter or with separate cover bought before you go.
• Travel policies often include rental vehicle excess cover; Cover-More lists $5,000 on International Comprehensive and $10,000 on Comprehensive+.
• With separate cover you usually pay first and claim later, so keep the paperwork.
• Go through ShopBack before you check out. Your effective price is what you pay minus the cash ShopBack returns.

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Frequently asked questions

Do I need rental car excess insurance, or is the hire company's cover enough?

You don't have to buy it, but the hire company's included cover usually still leaves you liable for an excess of several thousand dollars. Avis, for example, lists a standard excess of $5,900 for small to large cars in Australia. If you couldn't comfortably pay that, reduce it, either with the hire company's own option or with separate cover such as a travel policy that includes rental vehicle excess.

What is a rental car excess?

The excess is the most you pay the hire company if the car is damaged or stolen while you have it, under the cover included in your rental. Avis calls its included cover a Loss Damage Waiver and says it limits your financial responsibility for loss or damage to the car and third party damage or injury, subject to its terms.

How much does Avis charge to reduce the excess in Australia?

Avis lists the excess amounts rather than a single price on its coverage page. For small to large cars, the standard excess is $5,900, Excess Reduction lowers it to $1,500 and Zero Excess lowers it to $0, according to Avis at the time of writing. Four wheel drive and luxury vehicles have a $6,900 standard excess. The daily cost of each option shows when you book.

Does travel insurance cover rental car excess?

Many policies do, up to a limit. Cover-More's international plans list rental vehicle insurance excess cover of $5,000 on Comprehensive and $10,000 on Comprehensive+, and none on Basic, according to Cover-More. Fast Cover lists rental vehicle excess as optional cover. Check that the limit is at least as high as the excess on your rental agreement.

Is excess cover from the hire company better than travel insurance?

They work differently. The hire company's option lowers what you owe at the counter, so there is usually nothing to claim back. With travel insurance or other separate cover, you usually pay the hire company first and then claim from your insurer, which is why Cover-More asks for a final loss or repair report. Separate cover can cost less per trip, especially on longer rentals.

What does rental car excess cover not include?

It depends on the policy. Avis says its Loss Damage Waiver, Excess Reduction and Zero Excess do not cover certain loss or damage, including overhead, underbody and water damage. Travel insurance has its own limits and exclusions in the Product Disclosure Statement, so read the rental vehicle section before you rely on it.

What is Discover Cars Full Coverage?

Full Coverage is optional protection you can choose when you book a car through Discover Cars, which compares deals from many rental suppliers. You choose it when you book the rental, and its limits and claim steps are set out at booking.

Do I need excess cover for car hire within Australia?

The excess applies in Australia just as it does overseas, so the same question applies: could you pay it if something happened? Avis says an excess generally applies if your rental vehicle is involved in an accident in Australia. Domestic travel policies from some insurers, including Cover-More, also list a rental vehicle insurance excess benefit, so compare that with the counter option.

How does ShopBack lower the cost of car hire and excess cover?

Booking through ShopBack lowers the cost of the trip, and you still book on the site you chose. Open the ShopBack page for Discover Cars, Cover-More or Fast Cover, tap through, and book or buy. Part of what you pay comes back to your ShopBack Australia account as cash; the live rate is on each store's ShopBack page.

Can I use a promo code with ShopBack on car hire or travel insurance?

No code needed: go through ShopBack before you pay and part of what you spend comes back as Cashback. Open the ShopBack page for Discover Cars, Cover-More or Fast Cover, tap through, and book or buy.

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Disclaimer

The views and recommendations expressed in this article are those of the author. Excess amounts, excess reduction options and prices, travel insurance limits, exclusions and Product Disclosure Statements vary by hire company, insurer, vehicle, location and time and are subject to change. Read the rental agreement and the PDS before you rely on any cover. Prices in the worked examples are illustrative. ShopBack rates vary by store and over time; check the current rate on each store's ShopBack page before you book or buy.

This article is intended for general informational purposes only and should not be considered professional, financial or insurance advice.