Before setting off on your travels you will need to make sure your insurance covers your car when driving in another country. This includes both taking your own car or hiring a car when you arrive there.

UK vehicle insurance often provides the minimum compulsory insurance cover to drive in other European Union countries, as well as other countries that have been specified in your policy document. However, policies don't usually offer the same level of protection that is provided when driving on UK roads - leaving you open to costly payments if you were involved in an accident or breakdown.

If your basic car insurance policy doesn't cover you for trips abroad, you'll need to take out a specialist European car insurance policy.

Insurance if you're using your own car

There are different levels of European car insurance. Some policies over a minimal level of cover, where as others offer a more comprehensive cover. Choosing the cheapest may not always be the best way to decide which to take out, so make sure you know every detail of the policy before making a decision.

The minimum level of insurance required for driving in Europe is a motor insurance certificate or 'green card' - this is the most basic, and often provides less protection than third party car insurance cover does in the UK.

For peace of mind when driving abroad, there are more extensive policies that will provide protection that is of the same scale as fully comprehensive car insurance in the UK.

What to check for with European car insurance

  • Some policies impose a limit on the length of time you can be covered for when driving abroad, so make sure the limit covers your time in the country. If it doesn't, you can enquire about extending the insurance.
  • Some policies will only cover countries that are in the European Union, which would be bad news for those travelling to Iceland, Liechtenstein and Norway.
  • You may need some extras with your European car insurance policy, such as European breakdown cover as extras may not be automatically included.
  • Some providers won't offer European insurance if you're aged under 25, so if you are younger than this you may find it difficult to get your vehicle insured. Always contact your insurance company to see if they will consider you.

Insurance if you're hiring a car abroad

Some countries legally require you to have three types of basic insurance, and often they are included in your car hire costs and contract. These three types are:

  • Cover for any damage caused to the vehicle. This can often be referred to as 'collision damage waiver', 'damage excess waiver' or 'vehicle damage cover'
  • Cover for the theft of the vehicle, also known as 'theft protection' or 'vehicle theft cover'
  • Cover for injury or property damage suffered by a third party, also known as 'third party cover' or 'supplementary liability'

Credit card pre-authorisation

When picking up your hire car you are often asked to show your credit card at the desk. This is because the car rental agreement that you sign usually includes an authorisation for the rental company to charge your credit card for additional items.

After signing the car rental agreement and provide this authorisation, the hire company can then take a payment from your card without informing you or requiring permission. To avoid fallen victim of extra charges of, for example, the full 'excess' cover for minor damage to the hire car, check the car thoroughly and make a note of every scratch and mark before taking it back.

This way you can make sure that the hire company signs and records every mark so that you can both agree on the condition that the car was returned in.