Car Hire Excess Insurance

Every hire car in the Canaries comes with basic damage cover that leaves you liable for the first slice of any claim — the excess — and the rental desk will offer to remove that liability for a daily fee that usually works out at three or four times what the same cover costs bought separately. That single fact is worth more to your holiday budget than any other piece of car hire advice.

The excess on a standard Canarian rental commonly sits somewhere between about €900 and €1,500, and higher on larger or premium cars. It applies to a scraped alloy as readily as to a written-off bonnet. Left uncovered, one careless moment in a narrow village street becomes a four-figure bill.

So you do want cover. The question is only where you buy it, and the answer is almost always: not at the desk, at eleven at night, with a queue behind you and a tired agent explaining that the roads here are very narrow.

What you are actually buying

Rental insurance comes in layers, and the jargon is deliberately opaque:

• CDW / collision damage waiver — included by law in Spanish rentals. It is not insurance but a waiver: the company agrees not to pursue you for the full value of the car, but you still owe the excess.
• Theft protection — the same structure, applied to the car being stolen.
• Third-party liability — damage you do to other people and their property. This is compulsory and always included; you are never uninsured for it.
• Super CDW / SCDW / "full protection" — the upsell. It reduces the excess to zero, or close to it, for a daily fee.
• Standalone excess insurance — a separate policy you buy from an insurer, which reimburses you for the excess you have paid.

The last two do the same job by different routes. Super CDW means you never pay the money in the first place. Standalone cover means you pay the rental company and then claim it back. That difference matters, and we will come to it.

The numbers, plainly

As 2026 framing rather than a quotation: super CDW at a Canarian desk typically runs somewhere in the region of €12 to €25 a day, with premium brands and airport locations at the upper end. Over a fortnight that is a couple of hundred euros, frequently more than the car itself cost to hire.

A standalone annual excess policy from a UK or Irish specialist insurer generally costs in the region of £40 to £70 for a year of European cover, with single-trip policies cheaper still — often under £20 for a week or two. The gap is not marginal. It is the difference between a rounding error and a meal out every night.

The catch with standalone cover

Standalone excess insurance does not stop the rental company charging you. If you damage the car, they take the excess from your card exactly as their contract allows, and you then claim it back from your insurer with the rental agreement, the damage report and the receipts.

Three consequences follow. You need a credit card with enough headroom to absorb a four-figure charge. You need to keep every piece of paper. And you need to be able to wait weeks for reimbursement. For most people that is a fair trade for saving two hundred euros; for someone who would genuinely struggle to have €1,200 taken off a card in the middle of a holiday, the desk's version has a real, if expensive, convenience value. Be honest with yourself about which you are.

Check the policy exclusions too. Most standalone policies exclude the same things the rental company excludes — driving on unsurfaced roads, misfuelling, driving under the influence — and some also exclude specific car categories. Read the list before you rely on it.

The Canarian exception worth knowing about

There is a local wrinkle that visitors from Britain rarely expect. Several long-established Canarian rental firms, of which Cicar and Autoreisen are the best known, have built their reputation on including comprehensive cover with no excess in the headline price, together with a full-to-full fuel policy and no deposit hold on your card. No upsell conversation, no waiver, no €1,200 blocked on a credit card.

Their headline rate is therefore usually higher than the cheapest broker price you will find online, and lower than that same broker price once you have added excess cover, fuel and the rest. For a lot of visitors they turn out to be both cheaper and considerably less stressful. Terms do change, so confirm what is included for your dates rather than taking it on trust — but it is worth quoting them alongside the international brands before you book, and it is the reason experienced repeat visitors to Lanzarote and Fuerteventura often use the same local firm every year.

The other upsells, and which are worth it

Fuel policy. Insist on full-to-full: you collect it full and bring it back full. The alternative, where you buy a tank from the company at their price plus a service charge and return it empty, loses you money every time. Fill up a few kilometres from the airport rather than at the forecourt outside it, and keep the receipt — island fuel is cheap, so this is a small cost done properly and an irritating one done badly.

Additional driver. Usually charged per day, and it adds up. Some companies and some Canarian firms include one free. If only one of you is realistically going to drive the mountain roads, do not pay for two — but do not let an uninsured person drive either, because a claim with the wrong person behind the wheel voids everything.

Child seats. Legally required for younger children and expensive to hire — often close to the cost of buying one. Many airlines carry a child seat free as part of the baggage allowance, which is usually the cheaper route.

Satnav. Skip it. Your phone does the job, and roaming or a local eSIM costs less than a week of satnav hire. Download the offline map for the island before you set off, because mountain signal is patchy.

Cross-border or inter-island travel. Taking a hire car on a ferry to another island usually needs permission and often an extra fee, and taking it without telling them can void your cover entirely. If your plans include a crossing between islands, declare it at booking.

Deposits and the credit card hold

Unless you have hired from a firm that waives it, expect a hold placed on a credit card at pickup, typically in the region of the excess amount. It is a pre-authorisation rather than a charge: the money is not taken, but it is blocked, and it reduces your available credit until it is released, which can take a week or two after you return the car.

The card must normally be a credit card in the main driver's name, embossed, with enough available limit. Debit cards are frequently refused for the deposit, and prepaid cards almost always are. This is the single most common reason people are turned away at a Canarian rental desk, and a booking confirmation will not help you.

What to photograph at pickup

Five minutes in the car park is the best insurance of all. Before you drive off, take your phone and record:

1. A slow walk-around video of the whole car, narrating the date, in daylight if possible. Video is harder to dispute than stills.
2. Close-ups of every existing mark — every scuff, every kerbed alloy, every stone chip in the windscreen. Alloys and the lower bumpers are where disputes happen.
3. The roof and the underside of the front spoiler, which nobody checks and which pick up damage on steep ramps and rough tracks.
4. The fuel gauge and the odometer, with the ignition on.
5. The signed damage sheet the agent gives you, with every mark you found actually written on it. If a mark is not on the sheet, get it added before you leave.

Repeat the video at drop-off, especially if you are leaving the car in an unattended bay outside opening hours, which is when unexplained damage tends to appear. Keep everything until the deposit hold has been released and a month has passed.

The damage that is never covered

Even zero-excess cover has exclusions, and they are remarkably consistent across the industry. Tyres, wheels, glass and the underside of the car are commonly excluded from standard waivers, though some policies add them back for a fee. So are keys, interior damage, and anything caused by driving where the contract forbids.

That last point has real Canarian teeth. Rental contracts here almost universally prohibit unsurfaced roads, and the islands have some spectacular ones: the track over the mountain to Cofete on Fuerteventura, the rough approach to certain beaches, various forest tracks. Drive them and you are uninsured for the consequences, whatever you paid at the desk. Misfuelling is excluded too, which is why getting the word gasolina right matters so much.

Do you already have cover?

Check before buying anything. Some premium credit cards include car hire excess cover as a benefit. Some annual travel insurance policies include it as an option. Packaged bank accounts occasionally do. It is not common, and the terms are often restrictive, but it takes one phone call to find out and it may save you the purchase entirely. Our page on travel insurance for the islands covers what the rest of a policy should include.

What your ordinary UK motor policy will not do is cover a hire car abroad. Do not assume otherwise.

The bottom line

Buy excess cover — but buy it yourself, before you fly, from an insurer rather than from the desk, and make sure you have a credit card that can absorb the deposit. Or sidestep the whole conversation by hiring from one of the Canarian firms that includes full cover in the price, which for many visitors is the calmer and no more expensive answer. Then spend five minutes filming the car, insist on full-to-full fuel, and go and enjoy roads that genuinely deserve a car: the drive to Teide, the hairpins above Masca, the empty coast road down to Playa Blanca. The practical side of the rental itself, from licences to what to expect at the desk, is in hiring a car in the Canaries, and the rules of the road are in driving in the Canary Islands.