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Car rental excess insurance and VAT on excess

xorzp Posts: 7 Forumite

19 April 2024 at 4:05PM in Flights, currency & car hire

I have recently rented a car aboard from Budget and unfortunately had a damage. I have taken a car rental excess insurance separately, so I claimed the excess.

However, Budget charged me the excess + 22% VAT on excess + 20% location surcharge (airport tax) on excess + 22% VAT on location surcharge. Basically, it ended up being almost 50% extra from the excess itself.

The excess insurer claimed that it doesn't pay for VAT and location surcharge. I'd imagined that if I take the extra insurance directly from Budget (albeit more expensive), it would cover everything.

Is this a common practice for independent excess insurers? I can now see why they can be cheaper since I ended up paying half the quoted excess anyway. I didn't know this before, so it would be a good reminder for the next time.

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Car rental excess insurance and VAT on excess

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