We got charged four hundred dollars for one toll.
One toll booth. We drove through it once, in a rental car, and thought nothing of it. What we didn’t know is that passing it enrolled us in the rental company’s toll program at $14.95 a day, and that charge repeated every single day for the rest of the trip. We never went through another toll.
We found out months later, when the charge landed on the credit card and the trip was long over.
When Matt called to ask what had happened, the man on the phone said, “Oh yeah, this happens a lot.”
Thanks for the warning.
That’s the thing about renting a car in another country. The car is usually the easy part. It’s everything stapled to the car that costs you.
This article is about that everything. What you’re actually insured for, which is almost never what you think. What license you need. And the specific ways a rental goes wrong, most of which are preventable in about ten minutes.
If what you want is how to book one, step by step, it is all in my free guide Why I Use and Recommend Discover Cars (And Exactly How It Works). This is the other half.
The insurance part, which almost everybody gets wrong
A reader wrote to me this summer with the best question I’ve had on this topic all year. She’d read the fine print on her credit card, and it said the card would cover her rental car up to its full value. So she wanted to know: was she covered?
The answer is that she was covered for one thing and completely exposed on another, and the difference is the most expensive misunderstanding in car rental.
There are two entirely separate things that can go wrong, and they’re insured separately.
One: you damage the rental car. You scrape it on a wall in a lane built for a donkey cart. That’s a collision damage waiver, or CDW. Sometimes it’s called LDW.
Two: you injure somebody, or you damage their property. You pull out at a junction and hit another car with a family in it. That’s liability, and it’s the one that can genuinely ruin you.
Here’s the part that catches people. A collision damage waiver covers the rental car. It does not cover liability. That’s not fine print or a loophole, it’s what the product is. Progressive says it plainly: collision damage waivers only cover damage to the rental car, and they don’t cover liability-related expenses.
And your credit card’s rental benefit is the same shape. Whatever your card offers, it’s a version of the first thing. It’s about the car. Almost none of them touch liability.
So my reader had read her card’s terms correctly and drawn the wrong conclusion, which is exactly what the wording invites you to do.
What this means in practice, and it depends where you’re going
In the EU, you’re in better shape than you probably realize. The European Commission says the rule plainly: EU law “obliges all motor vehicles in the EU to be covered by compulsory third party insurance,” and anyone holding that cover “is covered to drive throughout the entire EU.” So it comes with the car, it’s already in the price, and it follows you across borders. What you’re being sold at the counter is the other thing, cover for damage to the car itself.
Outside the EU, check rather than assume. The UK, Switzerland and the Balkans sit outside that rule.
In the US and a lot of other places, liability is the gap. It’s usually your own auto policy that covers it, if you have one and if it extends to rentals. If you don’t own a car at home, you may have no liability cover at all, and that’s the situation worth thinking hard about before you decline anything at the counter.
The word nobody explains: excess
Rent outside the US and you’ll meet the word excess. Nothing about it explains itself, and it sits at the center of every decision you’re about to make.
The excess is the amount you’d have to pay yourself if the car gets damaged. If you’re American, it’s your deductible. Same idea, different word, and abroad you’ll only see the second one. A car with a £1,200 excess means the first £1,200 of any damage comes out of your pocket.
It is not the deposit. This is where it gets genuinely muddled, because you’ll meet both on the same booking.
- The deposit is money the rental company freezes on your credit card when you collect the car, as security. You don’t spend it and you get it back after you return the car, though it can take days or weeks to reappear.
- The excess is money you only ever pay if something actually happens to the car.
Both are set by the rental company rather than the comparison site, so both change from listing to listing. And both are on the page before you book, which is the best reason there is to read the conditions on your specific car.
When you buy coverage, what you’re really buying is a smaller excess. That’s all the counter’s product does, and all the comparison site’s cheaper add-on does.
And here’s the part that surprises people even when they’re fully covered. Most of these, your credit card benefit included, work as reimbursement. You pay the rental company first and claim it back, so you still need room on your card to absorb the hit meanwhile.
A deposit hold and a damage charge on the same card can eat enough of your limit that it starts getting refused at dinner, which is one of the quieter reasons a card stops working abroad. The rest of them are in my free guide When Your Credit Card Doesn’t Work Abroad.
What we actually do
Matt and I lean on the rental coverage that comes with our Chase Sapphire Reserve rather than buying the counter’s product. But card benefits differ enormously and they change, so don’t copy us.
Call your card issuer before the trip and ask three specific questions. Does the benefit cover the country I’m going to, because some cards exclude specific ones. Does it cover the length of my rental, because many cap out around thirty days. And does it cover liability, where the answer will almost certainly be no, so you know what you’re still carrying.
Then ask for a written letter of coverage. We do this every time. One phone call, they email it over, and when the agent at the counter tells you your card won’t cover you, you have the document in your hand.
And decide before you walk up to the counter. The counter sells you cover at the exact moment you’re tired, holding up a line, and least able to compare anything.
The license part, which is simpler than it sounds
For a lot of countries, your home driver’s license is enough.
For plenty of others, you also need an International Driving Permit. It isn’t a license. It’s a translation of the one you already hold, in a standard format, and it’s only valid alongside your actual license.
You get it at home, before you leave. In every country it’s a motoring club that issues it, not the government, and only specific organizations are authorized.
In the US, the American Automobile Association or the American Automobile Touring Alliance, and nobody else. AAA charges $20, wants two passport photos and your valid license, and will do it in a branch, online or by mail. Branches can take the photos. Apply online and there’s a $10 photo fee and shipping on top, so the twenty dollars isn’t the whole twenty dollars, and you should allow five business days plus the post. There’s no digital version. It gets printed and mailed.
In Canada, the CAA. It’s $32 Canadian as of December 2025, though CAA says fees vary by province so check your own club. You need to be 18 or over with a full provincial or territorial license, and a learner’s permit won’t do. You don’t have to be a member. In person it takes under an hour.
In the UK, in person at a PayPoint shop that takes part in the scheme. It’s £5.50 and you’ll need your full GB or Northern Ireland license and a passport-standard photo, plus your passport if yours is still the old paper license. Not every PayPoint store does this, so use the locator on their site first.
In Australia, your state motoring club, acting as an agent of the Australian Automobile Association. NRMA, RACV, RACQ, RAA, RAC, RACT or AANT depending where you are. It’s $55 and you need to be 18 with a provisional or full license.
If you’re in the UK, check which type you need, and don’t guess. Britain issues three permits, the 1926, the 1949 and the 1968, and they aren’t interchangeable. Most of Western Europe is on the 1968, France, Germany, Italy, Austria and Poland among them, along with Brazil, Thailand and Turkey, and that one runs for three years. The 1949 covers a different long list including the US, Canada, Australia, Japan, Spain and Ireland, and runs for one year.
That split catches people out, because the assumption is that one permit covers Europe and it doesn’t. And if you’re driving through more than one country on the same trip, gov.uk says you may need more than one type. The table there tells you which is which, and it’s worth two minutes before you pay your £5.50.
If you’re in Australia, check your own club about digital licenses. NRMA accepts a digital driver license. RACV asks for a physical one and won’t take digital or temporary licenses. So the answer genuinely depends on your state.
Everywhere else, an IDP runs for one year, or until your own license expires, whichever comes first.
One warning, and it matters more than the rest of this section. The US government’s own advice is blunt: beware of websites claiming to issue international driver’s licenses, because many are fraudulent and may try to scam you out of money or personal information. Search for this and you’ll find a wall of official-looking sites charging several times the real price for a worthless document, some of them harvesting your passport and license details on the way. Go to AAA or AATA in the US, the CAA in Canada, a PayPoint shop in the UK, or your state club in Australia. Nowhere else.
And check whether your destination actually requires one, because it varies by country and by which license you hold. Americans, the State Department’s country page for where you’re going will tell you. Brits, that same gov.uk table. Canadians, the government’s travel advice for your destination. Australians, Smartraveller.
In my own experience, you can’t rent a car in Japan without an IDP, full stop. And in Greece, several of the scooter rental shops wanted to see Matt’s IDP with his motorcycle endorsement on it before they’d rent us anything. So don’t get caught out.
What actually goes wrong, and how to stop it
After a lot of rentals across a lot of countries, the failures repeat. Here they are in the order they’ll cost you.
The damage claim you can’t disprove
This is the big one, and it’s getting worse. Rental companies are rolling out automated scanners at return lanes that photograph the car and flag damage, so a scratch you never made becomes your scratch unless you can prove otherwise.
So document it, every time. Before you drive off, photograph every panel, the wheels, the roof, the bumpers, the interior, the odometer and the fuel gauge. Then take a slow video walking around the car.
Two minutes, and it has saved us from a false damage claim more than once. Do it again at drop-off.
The toll program that bills you for days you didn’t drive
Our four hundred dollars. Rental companies auto-enroll you in their toll service, a single toll can trigger a daily access fee that runs for the whole rental, and you usually can’t use your own transponder.
Ask about the toll policy at the counter, or check it on the site before you book. If you can avoid toll roads, opt out of the program entirely.
The pre-checked boxes
Some agencies pre-select insurance, GPS, satellite radio or roadside assistance before you reach the payment screen. Booking online, untick everything you didn’t ask for. At the counter, ask them to read you the total before you sign.
Prepaid fuel
You’re charged for a full tank whether you use it or not, so unless you’ll return it on fumes you’re paying for gas you’ll leave behind. Fill up yourself near the drop-off.
The fees nobody mentions unless you ask
One-way drop-off charges. Airport surcharges. Young driver fees, and in some countries older driver fees too. Administrative fees for processing other fees.
Ask one specific question at the counter: what will show up on my card after I return this car that isn’t on this quote? That’s harder to wave away than “are there any extra fees.”
The booking habits that prevent most of this
Short version, because the Discover Cars walkthrough covers the mechanics properly.
Compare on more than one site. We use Auto Europe, which is the better one for comparing lots of providers and for handling different currencies, and Discover Cars, which has better filters and often comes in cheaper than booking direct.
Then check the rental company’s own site before you commit. The comparison sites usually win and sometimes they tie, but you only know by looking. Comparing is the point. Blindly booking through anybody, including a site I recommend, isn’t.
Book a refundable rate and recheck it, because rental prices move a lot.
Read the conditions on your specific car. Fuel policy, mileage limit, deposit, excess. Nearly every bad rental story starts with somebody skipping this.
Book early if you need an automatic, especially in Europe, where manuals are standard and automatics are fewer and pricier, although that’s slowly changing as automatics become more common there.
The part of this a rental agreement can’t help you with
Driving yourself solves a real problem. You’re not getting into a stranger’s car, you’re not negotiating a fare in a language you don’t speak, and you leave when you decide to leave. For a lot of women that’s the whole reason to rent one.
It also puts you in a pickup lot on the edge of an airport at eleven at night, on unfamiliar roads, reading signs you’re translating as you go.
Everything above keeps the rental company honest. None of it is about you.
That’s what I wrote The Smart Woman’s Guide to Safer Travel for. How to handle airports, taxis and rideshares in places where the rules are nothing like home. How to tell whether a neighborhood is safe before you book rather than after you arrive. And exactly what to do when something does go wrong, so a bad moment stays a small one. It comes with eight grab-and-go checklists and a fill-in emergency contact card, and it’s $19.99.
Sort the car out with this article. Sort out the rest of the trip with that.
The bottom line
The car is rarely the problem. The problem is what’s attached to it.
Three things and you’ll avoid most of what I’ve described. Know that your card covers the car and not the people you might hit. Get the International Driving Permit before you leave, if your destination wants one. Photograph everything before you drive away.
And when you get to the counter, remember that every extra they offer you is a decision you should already have made sitting at your kitchen table, where nobody was waiting behind you.
Compare prices on Auto Europe and on Discover Cars, then go and check the rental company direct.
Frequently asked questions
My credit card covers rental cars. Am I covered? For damage to the rental car, probably, subject to your card’s terms. For liability, which is injuring someone or damaging their property, almost certainly not. Those are two different products and the credit card benefit is the first one. Call your issuer and ask specifically about liability, the countries covered, and the maximum rental length.
What’s the difference between CDW and liability? A collision damage waiver covers damage to the car you rented. Liability covers what you do to other people and their property. The counter mostly sells you the first one. The second is the expensive one.
Do I need an International Driving Permit? It depends where you’re driving and which license you hold, so check your destination before you book. Where it is required, you get it at home before you travel: AAA or AATA in the US, the CAA in Canada, a participating PayPoint shop in the UK, or your state motoring club in Australia. It’s a translation of your license, not a replacement, so carry both. And if you or your partner holds a motorcycle endorsement and you’re planning to rent a scooter or a bike, check that the endorsement is actually shown on the IDP.
How much does an International Driving Permit cost and how long does it take? It’s $20 in the US, $32 in Canada, £5.50 in the UK and $55 in Australia, and it takes minutes over a counter. Two things that aren’t in those numbers: the US online route adds a photo fee and shipping, and Canadian fees vary by province. Allow several days if you apply online or by post. It’s valid for a year, with one exception: the UK’s 1968-type permit runs for three years.
I’m in the UK. Is there anything different about mine? Yes, and it catches people. Britain issues three types and they aren’t interchangeable. The one most people assume is the default, the 1949, does not cover France, Germany, Italy, Austria or Poland. Those are all on the 1968. Check the table on gov.uk before you pay, because the wrong permit is the same as no permit, and a trip through more than one country can need more than one.
Is insurance included when I rent in Europe? The legally required third-party liability cover comes with the car, which is the part that matters most. What you’ll be offered at the counter is cover for damage to the car itself, to cut down the excess, meaning the amount you’d owe if you damaged it. So the answer is yes for the big risk and no for the dented bumper.
What is the excess, and is it the same as the deposit? No, and they get muddled constantly. The excess, which Americans would call the deductible, is what you’d pay yourself if the car were damaged. The deposit is money frozen on your card as security when you collect the car and released after you return it. You only ever pay the excess if something happens. You always have the deposit held, even if the trip is perfect.
Should I buy the coverage at the counter? Decide before you get there, not while you’re standing at it. Work out what your credit card covers, what your own auto policy covers if you have one, and what the excess is on your specific booking. Then buy only the gap. People overpay at counters because they’re making the decision under pressure.
Why did I get charged after I returned the car? Usually tolls, fuel, a damage claim, or a fee that was disclosed somewhere you didn’t read. This is why the walk-around photos and the “what will show up later” question matter. If a charge appears that you can’t account for, ask for the documentation behind it.
Is it cheaper to book at the airport? Usually not. Airport locations carry extra surcharges. A city or station branch is often cheaper, with the tradeoff that it keeps shorter hours and may be shut on Sundays. In my experience they’re also slower than an airport counter, so I build in extra time at both pickup and drop-off.
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