The Car Rental Industry
Guide to Car Rental Companies in Costa Rica
Rate Comparisons for 2015
Car rental in Costa Rica is an opportunity to explore the remote beaches and quiet corners of this breathtakingly beautiful country. Travel without the restrictions set by public transport timetables and with freedom over group tours. For the unprepared traveler; however, car rental costs and services can be a rude shock and a blow to that vacation budget.
Renting a vehicle for your vacation will probably be the most expensive part of your budget, so understanding the terms and managing expectations is very important. The information below is not meant to be an exhaustive manual, but it should set you on the path towards an informed decision for your car rental needs in Costa Rica.
Why is car rental so expensive?
Visitors from outside of Costa Rica are often surprised by the cost of car rental. While hotel rooms, restaurant bills and tours are lower than the prices paid at home, it may appear strange that car rental should be more costly.
There are two simple reasons for this high cost:
- All vehicles in Costa Rica are imported and a tax is imposed. Due to this heavy taxation, the cost of purchasing a vehicle is higher than it would be in other industrialized countries. There are some car rental operators who rent older vehicles in order to reduce their costs.
- The cost of mandatory insurance (see below).
Factors that Affect Car Rental Costs
• Mandatory Insurance
Third-party insurance, which may be known as TPI, PDW (Partial Damage Waiver), SLI (Supplementary Liability Insurance) and other acronyms, is a legal requirement. Car rental operators must charge the customer for this coverage which may or may not be clear in the quotation received by the customer.
The insurance itself is not the issue. After all, many other countries require car renters to pay a mandatory insurance; including: New Zealand, Italy and Mexico, as well as a number of the U.S. states, like California. The issue that causes contention in Costa Rica is that this cost is not always displayed clearly on the car rental operator’s website or in a quote. Customers then discover the additional cost of their rental upon arrival. SANTORINI RENT A CAR
The cost of mandatory insurance varies from company to company and will depend on the car category that is being rented as well. The cost for a small sedan may be as little as $12 per day, whereas a premium 4×4 vehicle could be as much as $25 for insurance per day. This is in addition to the rental cost.
Credit cards in North America usually offer car insurance as an additional perk to the credit card holder and so North Americans in particular, are unused to having to pay for insurance on top of rental costs. However, no credit card will cover this insurance requirement.
Do ask if the given quote includes third-party insurance and check the prices on the car rental operator’s website.
• Collision Damage Waiver
This is not insurance, but a waiver. The basic level will come with a deductible that varies, but could be as much as $1,500. For a higher daily rate, a zero deductible CDW may be purchased to relieve the renter of any financial responsibility in case of damage to, or theft thereof, the vehicle.
Many renters will obtain their CDW through their credit card. However, it is worth noting that the responsibility for making any insurance claim is on the customer and not with the car rental operator. Some renters may choose to purchase additional in-house coverage to avoid having this responsibility.
There will be car rental agencies which hard sell their own coverage plans through guaranteeing peace of mind, but ultimately, this is the renter’s decision. It is worth remembering that car rental company employees, like in other parts of the world, will sometimes earn commission for insurance sales.
If the customer’s credit card does not provide CDW, the customer will be required to purchase this in-house coverage.
Car rental operators require written proof that the customer’s credit card provides CDW. Ask the car rental operator for the exact details of what they require and in what form. Some may accept a forwarded email from the credit card company, but others may ask for a printed copy to be presented at the time of rental.