Motor Insurance - The Loss of Use Policy Exclusion By: Trevor Dace

Here we examine the "loss of use" exclusion clause in your car insurance policy.It lays out what alternative transport your insurer will give you if your own vehicle is disabled because of accident or theft. In the majority of cases the answer is in the negative !!

Certain insurers have a team of approved repairers who will supply you with a courtesy car if one should be available. A few insurers have a hire car scheme as part of their policy whereby they will arrange a vehicle for you from their chosen hire car company. However, most insurers do not offer either of these options.

Most insurers offer a rental car option to their comprehensive policies. The option is quite pricey and the policy cover is fairly limited. You need to decide if you feel it essential that you purchase it. It is far from an essential extra for everybody. Answer these questions:

If my vehicle was inoperative would it be possible for me to :
- get to work (by bus, train, walk, cycle)?
- take the children/grandchildren to school?
- go shopping
- go on holiday?
- follow my social interests, hobbies, sports etc?

If you could cope without a vehicle for a few days, you don't really need to purchase this extra cover. If you're sure that you can't then you should pay the additional premiums.

Bear in mind, if your car is stolen or an accident is your fault, you won't be able to recover any car rental costs from another person. You can't use a 'credit hire' firm. You can't rely upon the prospect of a courtesy car from the garage. So this additional cover becomes valuable to you.

Equally, if you do not wish to use your insurer's recommended repairer, or your car has been written off, your hire car extra cover will save the day. Let's take a look at what you might hope to see in an average policy.

You may only hire a car if yours is off the road for at least 2 days, but the maximum period of hire is 14 days. If you need it for more than this you will have to pay the additional cost to the car hire firm. There's been many a disagreement between vehicle owner, repair shop and insurer when repairs have overrun often down to non-availability of parts and nobody wants to pay the extra car rental costs.

You cannot claim a hire car for a glass only or windscreen claim.

There is usually a maximum distance that the hire company will deliver a rental car so if you live out in the sticks and the hire firm is some few miles away from you, be prepared for an extra charge if you require them to deliver it to you. Is it possible for you to get to the nearest branch yourself?

Your existing car insurance policy will cover the hire car as if it were your own car. That helps your insurer to limit the cost of the hire car cover but if you are involved in an accident whilst using the rental car, the claim will be on your policy.

The rental car can only be claimed from the date your car goes in for repair if the damage to your car is such that it is still safe and legal to drive. If your vehicle is not safe to be driven you can hire the car from the date of the accident.

Policies might impose a maximum hire period, such as 14 days. If your vehicle is repaired prior to that date, you must return the hire car as soon as your vehicle is returned.

The rental car supplied will almost certainly be a basic, manual gearbox vehicle no more than a year or two old. If you need a larger model you might have to pay extra. If you desire an automatic they will try to find one for you within the price range specified in the cover. The hire car will usually come supplied with a tank full of fuel. You must return it with a full tank. If you don't you will be charged by the hire firm for a fill up. And they charge a ridiculously high price for fuel!

Some hire companies will want to collect your credit card number, if you have one, insuring against the chance of needing to top up the fuel in your car or bumping it whilst out and about.