• Collision Damage Waiver (CDW) may cover damage to the rental vehicle but may not be liable for damage to other vehicles or personal belongings.

• CDW does not cover personal injuries, personal belongings, or damage caused by negligence.

• Rental car damage coverage is an optional add-on coverage available with specific AXA Travel Protection Plans.
   

Renting a car on a vacation trip gives you the freedom to explore the destination at your own pace. But unexpected events like minor accidents, weather damage or theft can turn the same trip into a nightmare. In these cases, Collision Damage Waiver (CDW) can be a possible solution.

Whether it’s scratches, storm damage or the unfortunate event of theft, CDW means you won’t be hit with repair or replacement costs on your rental car. To learn more about it, let’s look at what CDW Insurance covers to ensure that your trip goes as planned.

What is a Collision Damage Waiver

When you rent a car, you are typically responsible for any damage that occurs to it, which can include things like minor scratches or even total loss due to theft or a major accident. The costs associated with such damages can be substantial, potentially running to thousands of dollars. A Collision Damage Waiver (CDW) mitigates this risk by reducing or eliminating the amount you would have to pay out of pocket in such scenarios.

While it's often offered by car rental companies, AXA Assistance USA, Inc. (“AXA”) also offers Collision Damage Waiver among its travel insurance products. Despite being called a "waiver," it functions as an insurance policy that reimburses you for eligible damages you might be charged by the rental company.

This means that although the rental company maintains the right to hold you accountable for damages, your AXA Travel Insurance steps in to cover the value of damages, subject to the policy's terms and conditions. It is also important for travelers to understand that this waiver doesn't cover liability for damage to other vehicles, personal injury, or theft of personal belongings from the rental car.

How Does a Collision Damage Waiver Work?

When you opt for a CDW, you pay an additional fee on top of your rental cost. In exchange, the provider, be it the rental company or AXA, agrees to cover certain damages to the rental vehicle. Here's how it typically works:

• Purchase the CDW: You can buy the CDW at the rental counter, online when booking your car, or through a trusted provider like AXA.
• Understand the Terms: The CDW will outline the scope of coverage, including what types of damage are covered, any exclusions, and conditions that may void the waiver.
• During the Rental Period: While driving, you must adhere to all traffic laws and rental agreement terms to ensure the CDW remains valid.
• In Case of Damage or Theft: If the car is damaged or stolen, you report it immediately to the rental company and AXA.
• Coverage Activation: The CDW covers the repair or replacement costs according to the agreed terms, potentially reducing or eliminating your out-of-pocket expenses.
   

What is Covered and Not Covered by a Collision Damage Waiver?

Understanding the specifics of what a Collision Damage Waiver (CDW) covers and what it doesn't is essential for making an informed decision when renting a car.
 

What is Covered by a CDW?

Collision Damage: CDW insurance covers damage to the rental car from a collision. This includes if the car hits another car or an object, like a tree or a fence. Whether it’s a minor scratch or a major accident, the CDW will cover some of the repair costs.

Theft Protection: AXA’s CDW also covers if the rental car is stolen during your rental period. If the car is taken without your consent, the CDW will cover the car or the costs associated with its loss, subject to the terms of the waiver. This is especially useful when traveling in areas with high car theft rates.

Vandalism: Vandalism or intentional damage by third parties is often covered by CDW. If someone intentionally damages the rental car, scratches the paint, breaks the windows, or causes other harm, the CDW will cover the repair costs, so you don’t have to pay out of pocket.

Accidental Damage: Accidental damage that occurs under normal usage conditions is usually included in CDW. This may include minor incidents like small dents from parking lot mishaps or damage from small debris on the road.

Additionally, AXA's Collision Damage Waiver is also extended to damages caused by a variety of unforeseen events. This includes

• Damage resulting from accidental fires, whether they're caused by mechanical failures or external factors.

• Natural events like hailstorms and windstorms that can harm the vehicle are also covered.

• Flood-related damages due to heavy rainfall or water incidents are included as well, which is particularly crucial when traveling in areas prone to flooding.
   

What is Not Covered by a CDW?

Personal Injuries: A CDW does not cover medical expenses if you or your passengers get injured in an accident. For medical bills, emergency services or hospitalization costs you need to get separate medical expenses coverage. This travel insurance will protect you and your passengers against medical expenses from an accident.

Negligence or Contract Violations: Damage caused by negligence or breach of contract is usually excluded from CDW insurance coverage. This includes driving under the influence of alcohol or drugs, reckless driving, allowing unauthorized drivers to drive the vehicle or using the car for illegal activities. Engaging in prohibited acts will void the CDW and you will be fully liable for all damages.

Personal Belongings: CDW does not cover loss or damage to personal items inside the vehicle. If your luggage, electronics or other valuables are stolen from the car or damaged during your rental period you would need to get personal effects coverage to be reimbursed.

Specific Vehicle Components: Some CDWs exclude coverage for certain parts of the vehicle like tires, wheels, windshields, mirrors and undercarriage. Damage to these components like a cracked windshield from a flying rock or a flat tire from a pothole may not be covered and you will need to pay for repairs or replacement yourself.

Administrative Fees and Loss of Use: Fees for processing a damage claim or compensating the rental company for loss of income while the vehicle is being repaired may not be covered by CDW. This means you could be liable for administrative charges, towing fees or loss of use fees that the rental company will impose. Knowing these costs will help you avoid surprises when you settle your bill.

Cost and Value of a Collision Damage Waiver

The cost of a Collision Damage Waiver (CDW) varies based on several factors, including the rental company, type of vehicle, destination, and duration of rental. But on average, it can range from around $10-$30 per day. While this might seem like a significant addition to your travel expenses, it's important to weigh its benefits against the potential risk of being liable for damage to the rental car.

When considering the value of CDW there are many benefits. CDW reduces or eliminates your liability for damage or theft of the rental vehicle and can save you from big out of pocket expenses. For example, AXA’s Collision Damage coverage offers up to $35,000 (Gold Plan) or up to $50,000 (Platinum Plan) for rental vehicle damage, a big safety net in case of unexpected events.

Also, you can travel with confidence, knowing you are covered for many risks. For example, AXA CDW can cover damage caused by fire, hail, theft, flood, collision, vandalism, windstorms and even events beyond your control while the car is in your possession.

Tips for Renting a Car with a CDW

When you add CDW to your travel insurance, make sure you follow these tips to be fully protected and informed.

Check what damages and scenarios are included and what is excluded in your rental car coverage. Look for any limitations on coverage like tires, windshields, undercarriage and exclusions for negligence or breach of the rental agreement.

When you pick up the rental car, take photos from all angles to document its condition. This will be your evidence in case you need to dispute any damage claims from the insurance company or rental car companies when you return the car.