Car Rental Insurance, the CDW Paradox

Renting a car is not as simple as you think, especially when it comes to choosing the best service with the safest cars and the most reliable insurance coverage. Sure, you can just rent anything from anyone if you want, but then what happens when you are involved in an accident?

In this article, I look at the car rental insurance paradox that vexes renters time after time.

Collision damage waiver, CDW.

You stand at the counter, or online, and you have suddenly faced with a slip of paper or a pop-up box stating the famous all-purpose “Drop the Keys and Forget It” insurance package, the CDW.

Well to start off with, even if you didn’t choose it, when you go to pick up the car, the attendant will probably try to re-persuade, but don’t give in. Why? Because the price is so overvalued, you could take your entire family out for a Pizza Hut meal and have enough change for a tip.

On the other hand, what is CDW? Well, it’s an insurance package that literally gives you a free pass even in a multi-car collision with nuclear weapons, Anthrax and a moped. You don’t pay a thing, and all this for a minimum cost of no less than $30 for the most basic model, and always much higher for the more expensive models.

Consider that the rental company pays around $3 to $4 a day to an actuarial pool. This means that all the difference is pure profit. And you thought buying drinks at a hotel was expensive.

However, with this price comes peace of mind, so the question is: is it worth it?

Pay Up Front

If you rely on your own insurance, such as a credit card that provides insurance options, you will have to play a damage claim up-front. Only after paying, can you try to recover the lost monies in a long and convoluted process that might end up costing you more than you get back.

The Pay Upfront issues I processed with the credit card details you give the rental company to take out the vehicle. They put some of the credit “on ice” to cover potential damages, as such, the entire amount is in the thousands, and while you might not feel it, since it doesn’t leave the card physically, it does get held on ice, so your credit cards limit is reduced by this action.

This is why the CDW is so profitable for you too, it costs you more now, and in the event of an accident, saves you later.

Damage Myths

If you don’t invest in CDW, you end up paying for more damage control then a “dent” to fix. What you get charged for is “Loss of use,” this is the estimated time lost the car could provide income, and they don’t mean operating hours, they go 24/7 with this one. Towing costs, since the car has to be towed even if it’s only a slight scratch on the paint. “Diminished value,” which stands for the depreciated cost of the sales price of the car as a used car. Remember that the average lifespan of rental is 2 years, so you get a hefty percentage of the lost car value added to the bill.

Next, come the ever popular administrative fees, these are calculated at CEO wage per hour when a basic clerk and some automated software does process the paperwork.

What to do?

If you don’t want to pay the CDW, then there are three options to choose from, these include:

Use Your Existing Insurance

Check your current policy; it might have a clause that covers short-term rental, if not, find out what this would cost you and factor this against how many times a year you rent a car. It could work out as being much better than the CDW. Just note that this only works in the USA. If you rent aboard this is not an option.

Use Credit Card Insurance

Most, if not all credit card companies offer various travel and renters insurance policies. They usually cover “free” collision coverage for car rentals. However, you need to use the card in question to pay for the rental service in the first place, and you need to make sure you activate the policy via the credit card site.

What a credit card typically covers is (as taken from a credit card insurance policy statement):

“Physical damage and/or theft of the covered rental vehicle. Valid loss-of-use charges assessed by the rental company while the damaged vehicle is being repaired and is not available for use, as substantiated in the company’s fleet utilization log. Reasonable and customary towing charges related to a covered loss to take the vehicle to the nearest qualified repair facility.”

Take heed to the important wording: “as substantiated in the company’s fleet utilization log” this is an issue with the lesser car rental companies that don’t give out such information to credit card companies.

Note that the more exclusive your card, the more coverage you get.

This option is good for international rental services.

Third-Party Car Rental Insurance

A lot of people rent cars as part of a package deal through their travel agency, such as Expedia and Travelocity. These online travel agencies (OTA) provide a cheaper CDW, but this comes at a cost. The cost is that you have to pay upfront and claim later.

As a rule, the concept of paying out over three to ten times the amount you would normally pay for a CDW is annoying. However, the car rental companies figure out that most people will factor in the overall cost and check that the CDW is usually around 10% of the total rental fee, which a lot of renters consider to be an acceptable hassle-free rate when compared with the hand on pay upfront alternatives.

Conclusions

Sometimes the hassle of processing insurance is too much of an issue for most travelers to handle, and they prefer a quiet voyage without having to remember every insurance cover by different sources. The CDW is overpriced, but it does come with an easy rest advantage, and for someone that has been involved in two auto accidents in different countries in the last 40 years, I can assure you that extra $30 was a price well paid after the lesson learned the first time.

What are those white spots on your face?

There are many types of white spots, and they emerge from different causes, as such they are also treated with different methods and medications.

In this article, I look at four possible causes for white spots, the most common ones, and define what causes them, and provide different treatment options.

1. Milia

Milia under the right eye

Milia is not a dangerous or painful condition, and they are not whiteheads. Milia is common with a lot of people. Milia are small round, hard, white bumps on the face formed in the skin layers when Keratin and dead skin cells get trapped below the skin surface.

Milia are most often seen around the eyes, cheeks, and on the nose and are found in all ages and both sexes. Milia are frequently found on small babies and are called milk spots.

Causes

Milia is usually caused by an allergic reaction to soap, cream or from overexposure to the sun.

Treatment

As a rule, within a few weeks without treatment, especially when the cause has been assessed, such as changing a soap, or stop in the use of a cream, the Milia disappear.

Do not squeeze them or cut them; they are not whiteheads.

Other treatment options include using an exfoliating cream, wearing sunscreen when going out, changing soap, shampoo or facial cream.

If the milia do not go away, you should visit a dermatologist who will either lance the dots to extract the keratin, or will offer to apply a retinoid cream. In some instances, you might get microabrasion treatment or even a skin peel.

2. Pityriasis Alba

What is causing my rash?

Pityriasis Alba is one of those conditions that has stumped doctors for centuries, and its cause is not known. It is considered to be a form of eczema, and its appearance is like a pale pink or red, scaly area with clear to smooth white (hypo-pigmented) patches.

When it occurs, it comes in groups of up to 20 patches, usually on the face and arms and is more noticeable on darker skin individuals or after sun exposure.

Around 5% of the world’s population suffers from this, with the majority of sufferers being children.

Causes

As yet, the cause of pityriasis alba is unknown

Treatment

There is no treatment since the cause is unknown, whoever the patches disappear within a few months, and on rare occasions within a few years. If the patches become irritating, then physicians will offer steroid or non-steroid cream to ease the irritation.

3. Vitiligo

Vitiligo on a ladies left hand

Vitiligo is a melanin disorder that appears in many individuals, with a higher chance of it appearing in hereditary lines. As such, Vitiligo is when the melanin in the skin depletes in specific areas, and this leads to white skin.

Vitiligo is seen in darker skin individuals much easier than in lighter skinned and can occur in anyone at any time; Vitiligo affects around 1% of the world’s population. In most instances, Vitiligo will appear within half the sufferers before the age of 20.

Causes

Vitiligo can appear in anyone but is more likely to appear on a person that has a family member with Vitiligo.

According to the medical texts, the melanin in the affected skin has been destroyed by the bodies antibodies, and the skin cannot darken due to no melanin in the patch area.

Treatment

Vitiligo is very sensitive skin, as found in Albino’s, so you need to cover it with sunscreen, or you will suffer sunburn that can lead to skin cancer. Other than that, there are only cosmetic applications to cover the lighter skin if it affects your mental health.

Some physicians recommend higher strength corticosteroid, which has shown to help restore missing pigment. However, this is not a recommended long-term option due to the effect that such creams have on the body over time.

Other options include artificial ultraviolet (UV) light treatment or phototherapy, and recently laser treatment has shown some success.

4. Pityriasis Versicolor

Pityriasis versicolor (also called tinea versicolor)

Pityriasis versicolor is a yeast infection that causes lighter or darker patches on the skin.

Pityriasis Versicolor can itch and looks like a dry patch, and it is more noticeable on darker skin. This ailment occurs in hot and damp (tropical and sub-tropical) climates more common than in cooler climates.

Causes

Nearly all the worlds adult population (over 90%) has a naturally occurring yeast called Malassezia living on their skin. This yeast is totally benign most of the time. However, the yeast overgrows in certain conditions, such as in hot and damp conditions, on oily skin, where the individual has a weak immune system, or due to an individual’s hormonal changes.

Treatment

There are a number of ways to treat Pityriasis Versicolor, sometimes it takes weeks, other times months. These medications include anti-fungal creams and lotions applied to the affected areas, or anti-fungal pills prescribed by a doctor when Pityriasis Versicolor covers large areas of the body.