Self-drive tours are becoming more popular for travellers who want to enjoy their holidays at their own pace, but car renters should beware of the hidden charges and limited insurance coverage when renting a car abroad.
In a recent study published in Australia's CHOICE magazine, it is revealed that car renters are likely to encounter surcharges and administrative fees on top of the optional fees for excess reduction - which could pile up the bills to exorbitant levels.
"Premium location surcharge" (PLS) as high as 23% of the rental cost can be imposed on renters if they choose to pick up or return the car at "premium" locations such as the airport.
And various administrative charges, like filling up the gas tank or paying for traffic tickets, can run up to 9.95% of the rental bill.
Consumers are often unaware of these additional fees and charges as the terms of which are often hidden in the small print at the back of the contract.
The Consumer Council adds that, in some cases, consumers might encounter some bill shock when they received the credit card statement after returning home, as toll payments or repair fees will still be deducted from the deposits which the companies usually placed on hold for one to two months.
The exclusions and limited coverage in the insurance policies provided by the car rental agencies meant that consumers may have to face additional costs in case of an accident.
In Australia, most rental car insurance policies did not cover damages to tyres, windscreens, interior, roof, water damage as well as collisions with wildlife, the costs of which car renters will be held liable.
Even if the insurance covers part of the rental car excess, the excess is still high. The study revealed that the renter will be liable for an excess up to AUD 9,900 (approx. HK$ 82,000) for damage if the accident occurred on unpaved road.
These problems and practices regarding car hiring in Australia may also be found in other places. In Hong Kong, the Consumer Council received 5 complaint cases over the past 6 years, most consumers were shocked by the bills with excessive charges and unreasonable deductions after returning to Hong Kong.
In preparing for a self-drive tour, travellers should seek information about the driving rules and road conditions in the countries they plan to visit. Some car rental companies will impose age restrictions on motor insurance.
Consumers are advised to book in advance, as hiring at the rental counter usually costs more. Peak seasons like summer holidays and Christmas are often fully booked two to three months in advance, travellers are encouraged to plan ahead.
Renters should inspect the car with great care before driving off. If there are any dents or damages on the car, take a photo for record and make sure the company staff noted the problem and marked it on the car layout plan.
Return the vehicle at scheduled time and location, and if possible, return it during counter opening hours so that company staff can conduct the car inspection before the customer leaves. Always return the vehicle with a full tank to avoid expensive refueling charges and administrative fees.
Consumers may consider taking out a more comprehensive car insurance policy as most rental car insurance only provide third-party liability coverage. Moreover, as car insurance policies usually do not cover personal injury of the driver, the driver may need to take out suitable travel insurance before departure.
Hong Kong motorists who do not have any experience of driving in snow are advised not to drive in such weather conditions.
The consumer should report to the credit card companies immediately if they found any unapproved billings or suspicious transactions.
The Consumer Council reserves all its right (including copyright) in respect of CHOICE Magazine and Online CHOICE ( https://echoice.consumer.org.hk/ ).