November 27, 2022

One product that is growing in popularity is excess wear and tear waiver insurance for rental cars.

Is it worth it?

Answer: That’s not really the most important question.

Mal comprise

Indeed, the problem is elsewhere: most consumers do not know, in fact, what they subscribe to, in particular the real extent of the protections. Many of these programs are sold by dealerships with flyers, but the limitations are outlined in the fine print on the contract. Consumers sign a little with their eyes closed.

For some programs, the dealer would pocket an amount representing almost half of the premium. The sales incentive is therefore very high.

“I’m not saying that these programs are bad: some consumers like them because they have peace of mind,” explains George Iny, director of the Association for the Protection of Motorists (APA). But consumers who complain say they are usually very poorly explained by dealerships. »

Two types are available on the market: those directly from manufacturers and those offered by dealers. Those of manufacturers would be more advantageous, according to Mr. Iny, because they are less expensive and it would be easier to make claims.

Because many consumers complain that when making their claim, especially when returning the vehicle at the end of the contract, surprise (!), certain damages are not covered, especially for body scratches or tire wear.

Some programs also cover damage that costs less than regular car insurance deductibles, such as wheel rim damage.

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Such protection makes Charles Tanguay, spokesperson for the Consumer Protection Office (OPC) hesitate.

“You have to be well aware of what is normal wear and tear on a vehicle,” he says. Often the dealership charges fees that they shouldn’t have (charged). »

Mr. Tanguay suggests having the vehicle inspected by an independent mechanic before returning it to the dealership at the end of the lease.

“Quebecers tend to be over-insured,” he continues. Is it worth paying $1,000 for protection that, in principle, might be covered by car insurance offered by an insurer? »

• This type of coverage is paid in addition to the rental of the vehicle. We are talking regarding a monthly payment varying between 30 dollars and 40 dollars. Over 48 months, we approach 2000 dollars. It’s very expensive for a product very poorly understood by consumers.
• Some dealers simply do not reimburse any claims if reimbursement requests are not provided for in the vehicle rental agreement.
• In times when the price of used cars is higher than the residual value of a leased car, it is advantageous to buy the vehicle back at the end of the lease. This type of protection is therefore not indicated, because, for certain programs, you lose the protection if you buy back the vehicle. You will have paid for nothing. But in four years, the used car market in Quebec may have changed…