Cover
Do I need extra insurance when renting a car in Australia?
Short answer
No, you don't need to buy extra insurance to drive away: every rental in Australia includes damage and theft cover. What you're deciding is how much you'd pay if something happens, and zero-deductible cover takes that from as much as A$6,600 (est. US$4,600) down to zero.
Last checked October 21, 2026By Brett Gould2 sources ↓
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Do I need an IDP?What's the deductible?How do I contact you?Sydney, Dec 4 – Dec 12, automatic, I'm 24Cairns, Dec 20 – Jan 3, an SUV, zero deductible
We sell rentals with either level of cover, so here's the plain comparison.
What's already included in every rental
- Damage and theft cover for the car, with a deductible.
- Damage to other people's cars and property is covered too, with the same deductible.
- Injury to other people is covered by Australia's compulsory third-party (CTP) insurance that comes with every registered car.
Your four options
| Option | Deductible if the car's damaged | Bond held on your card | You pay | Good to know |
|---|---|---|---|---|
| Standard cover (included) | A$5,500 (est. US$3,850) or A$6,600 (est. US$4,600) depending on the car | A$1,000 (est. US$700) | nothing extra | Lower price today; you carry up to the deductible |
| Zero-deductible cover (at booking) | A$0 | none (A$1 card check) | est. US$27-37 a day | Includes windshield and tires; nothing to claim back |
| Your credit card's rental cover | depends on the card | A$1,000 (est. US$700) | nothing extra | Usually you pay the rental company first, then claim from the card; check it covers Australia and the car type |
| Separate deductible insurance (bought elsewhere) | covered after you claim | A$1,000 (est. US$700) | that policy's price | Same pay-first, claim-later process |
How to choose (30 years of watching travelers decide)
- Want zero hassle? Zero-deductible cover: no bond, no claim forms, windshield and tires included.
- Card covers rentals in Australia and you're fine with an est. US$700 (A$1,000) hold? Standard cover plus your card can work, but you'd still owe up to the A$5,500-6,600 deductible first, then claim it back. Read your card's terms for Australia, SUVs and 4WDs, and unsealed roads first. Does my credit card cover a rental car in Australia?
- Long road trip, gravel, wildlife at dusk, or a 7-8 seater? Lower your deductible; small dings are more likely on long country drives. Driving with wildlife
What no cover includes
Damage from breaking the rental terms: driving where the terms don't allow (some unsealed roads, beaches, some islands), an unlisted driver, or driving under the influence. Your booking shows the exact conditions.
Related questions
Deductible & coverageWhat is a rental car deductible in Australia?It's the most you'd pay if your rental car is damaged or stolen.Cover, explainedZero deductible car rental in AustraliaDeposit & bondHow much is the rental car deposit (bond) in Australia?est. US$700 (A$1,000) with standard cover.Credit card coverDoes my credit card cover a rental car in Australia?It might, but only your card's terms can tell you.
Quick answers
Is rental car insurance mandatory in Australia?
Basic damage and theft cover comes with every rental, and every registered car carries compulsory injury cover for other people. Extra cover to lower your deductible is optional.
Is deductible protection worth it on a hire car?
If you'd rather not risk up to A$6,600 (est. US$4,600) or deal with a claim, yes. If your credit card covers rentals in Australia, it may not be.
What does the collision damage waiver (CDW) cover in Australia?
It's the part of your rental that limits what you pay for damage to the car to the deductible. Zero-deductible cover takes that to A$0.
Does my US car insurance cover me in Australia?
Usually not; most US auto policies cover the US and Canada only. Check with your insurer.
Sources
1Rental company cover termsDamage and theft cover, deductible by car class, bond and exclusions (rental terms cl. 4.1), as shown on each booking.rental terms
2NSW, VIC and QLD government CTP informationCompulsory third-party injury insurance on every registered car.state government sites
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