Controversial headline in Mail

In the "Money Mail" section of today´s Daily Mail there is a rather interesting article about car hire under the headline "Tourists held to ransom by car hire sharks". It is specifically reporting on several incidents relating to Goldcar... a very popular company here because of its low prices. However, on reading the piece it shows how and why they are at first glance so reasonable... or is this just a case of creative journalism - which we have seen a lot of in recent months (remember "Benidoom" in The Sun for instance)

The article alleges that "Holiday makers to Spain are being told they cannot drive away a hire car they have booked unless they pay another 100 euros for extra insurance OR have 1000 euros frozen on their credit card in case damage needs to be paid for"

Typically when you book a car online for your holiday the basic cost includes IVA and local taxes, unlimited mileage, collision waiver damage without excess, car passenger insurance and theft cover". I would suggest that 95% of people hiring cars just tick that they have read the "terms & conditions"... even I am guilty of that. It is normally pages and pages of clause this and that and you loose the will to live - airline T&C´s are probably the worse. Anyone who suffers from insomnia I suggest you read them - that´ll soon cure you!

Anyway, back to the car hire situation... by freezing so much credit on your card it will leave many without much or any money left to spend whilst holidaying. The majority nowadays do not take much cash and rely on using their credit cards for restaurant meals and entry to attractions. According to the Mail´s article, Goldcar are telling customers that they have one of two choices - pay for extra "super" insurance amounting up to 100 euros or have this extra charge held on their cards - they even interviewed a couple to whom it had happened.

I looked at the Goldcar website and spent some time scrolling through the Terms & Conditions. When referring to insurance it states "You must make a deposit of 300 euros which will be blocked from your credit card". Now 300 euros and 1000 euros is a considerable difference so I phoned the company to seek clarification on the points raised from today´s article. I had a detailed and thorough response from Laura at head office and she confirmed the following;

"Standard insurance included in the rental price does not cover 24hr free roadside assistance, damage to the undercarriage or clutch, tow truck services - it is illegal to tow a car in Spain, battery recharge, lost keys or damage to wheels, tyres and windows. Goldcar offers optional insurance to cover these items and so avoid leaving an excess deposit. Technically if you take it out you are liable for nothing.

Busy car rental desks at Alicante airport

Those customers which have comprehensive insurance with another company to zeroise the excess on car hire are advised that these policies do not cover them directly with Goldcar. You would therefore still need to leave an excess or security deposit. In the case of a claim, you as the policy holder would have to make the claim on your policy and not Goldcar - you would have to pay for the damage and then claim it back. This is standard with all insurance companies. If you chose NOT to take out Goldcars optional "Relax"insurance policy then you will have to leave a 300 euro security deposit on your credit card.

Regarding the customer whose case appears in the Daily Mail article, they have neglected to report that this customer paid by debit card. Goldcar is one of the few car rental companies that still offers the possibility to pay by debit card in certain cases on the condition that the customer takes out our additional insurance".

Companies which take debit cards for security deposits always take the maximum amount as they have no comebacks afterwards for extra payment, unlike a credit card where they can go back for payment. I experienced this some years ago when a parking fine was debited from my credit card some 4 months after I had hired a car. Had I used a debit card then they could not have taken this amount out.

So ensure if you do not plan on taking out the additional insurance that you have enough credit limit available on your credit card. But be warned that drivers in Spain are not very vigilant or careful. They park by bumping back and forth, and on pulling out almost always manage to catch and scratch the corner of your bumper. When getting in and out they bang their door into yours - just take a look at the majority of Spanish cars, they are virtually all knocked, dented and scratched!

I have just received an email from Monarch advertising a "special" deal with Avis car hire. When I checked the headline grabbing rate of a group B vehicle for only 141GBP the additional insurance came to a whooping 31.28 GBP per DAY but this still included an excess of 599 euros. If you wanted the all singing all dancing super insurance, meaning you have NO excess to pay in the event of damage or theft, it is an additional 10 euros per day! All these prices exclude IVA, which is now an additional 21%. So that 141 GBP isn´t quite as good as it initially looks!

Although eye wateringly expensive, can you afford not to take out the additional cover?