Explanation of Collision Damage Waiver (CDW)
The Collision Damage Waiver (CDW) is an optional protection plan offered to you, the customer, to reduce your financial responsibility for damage to the rental vehicle.
Here is a breakdown of how it works:
1. The Standard Responsibility (Without CDW)
· Without the CDW, if the rental vehicle is damaged, you are fully responsible for the repair costs up to a maximum amount, known as the “excess clause.”
· This excess amount varies by vehicle group:
· Group A: Up to RM 2,000
· Group B: Up to RM 5,000
· Group C: Up to RM 10,000
· Group D: Up to RM 15,000
2. The Protection Offered by CDW
· If you accept the CDW, you pay an extra 20% on top of your rental rate at the start of the rental.
· In return, the CDW waives (removes) a large portion of your financial responsibility for vehicle damage.
· However, the CDW does not cover 100% of the costs. You remain liable for a smaller, non-waivable amount called the “Non-Waiverable Damage Excess”:
· Group A: RM 1,000
· Group B: RM 2,500
· Group C: RM 5,000
· Group D: RM 7,500
3. Simple Comparison: With vs. Without CDW
Scenario Without CDW With CDW (Cost: +20% of Rental)
If you cause RM 8,000 damage to a Group B car You pay RM 5,000 (the full excess) You pay only RM 2,500 (the non-waiverable excess)
If you cause RM 15,000 damage to a Group D car You pay RM 15,000 (the full excess) You pay only RM 7,500 (the non-waiverable excess)
4. Important Exclusions to Remember
The CDW (and the standard insurance) will NOT cover damage resulting from:
· Negligence (e.g., careless driving).
· Tire punctures or burst tires.
· Using the wrong fuel type.
· A flat battery because you left lights or electrical devices on.
· Loss or damage to vehicle accessories (e.g., keys, audio system).
· Underbody or overhead damage (you are always at risk for this).
· Driving on unsealed or unmade roads (e.g., rough dirt tracks), which voids all insurance.
In Summary:
Think of the CDW as an option to significantly lower your financial risk. By paying a relatively small upfront fee (20% of the rental), you cap your potential repair bill to a fixed, lower amount (the Non-Waiverable Excess) instead of being liable for a much higher standard excess. It provides peace of mind for a known, additional cost.