Quick Summary:
- CDW and LDW are often similar in the US, but not identical.
- Check the deductible, exclusions, and whether theft is included.
- Confirm coverage applies on all roads, including unpaved or restricted areas.
- Review what is excluded, tyres, glass, roof, underbody, and keys.
When you arrange car hire in the United States, you will almost always see either CDW (Collision Damage Waiver) or LDW (Loss Damage Waiver) listed in the rental terms. UK travellers often assume these are the same product with different names. In practice, they can overlap heavily, but they are not guaranteed to be identical, and the differences can matter when something goes wrong.
This guide explains how CDW and LDW are used in US car hire contracts, what they generally do, and the exclusions you should check before you collect the vehicle.
What CDW usually means in US car hire
In US rental language, CDW is typically a waiver that limits what the rental company can charge you if the vehicle is damaged in a collision, or if it is otherwise damaged while in your care. It is called a waiver because it is not sold as insurance by the rental company, it is a contractual promise not to pursue you for the full cost, as long as you follow the agreement.
However, CDW is not a single standard product across all suppliers. One company’s CDW might include theft, another might not. One might reduce liability to zero, another might leave you with a deductible. One might include loss of use, another might still charge it. This is why reading the “what’s included” and “what’s excluded” sections matters more than the label.
If you are comparing terms across providers, it can help to view the supplier-specific information on a location page for your trip, then read the rental conditions carefully for the exact inclusion list.
What LDW usually means, and why it can be broader
LDW in the US is commonly used as a broader waiver than CDW. The “loss” part often signals that it covers both damage to the car and loss of the car through theft, vandalism, fire, or other events. Again, that is typical, not universal.
In many US contracts, LDW effectively bundles what some markets might describe as “CDW + theft protection”, plus limits on related charges. If you see LDW offered at a higher daily price than CDW, that may be the reason. But some suppliers use CDW to mean the bundled version too, so you cannot rely on the acronym alone.
For travellers flying into major hubs, you may see different terminology by city and supplier. For example, someone arranging car hire in Las Vegas might see LDW on one set of terms and CDW on another, even if the practical coverage is similar. The only safe approach is to compare the actual coverage statements and exclusions.
Are CDW and LDW “the same” on US car hire?
They are sometimes functionally the same, but they are not guaranteed to be. In the US, both are commonly waivers that limit your financial responsibility for damage to, or loss of, the rental vehicle. The differences usually appear in three areas:
1) Theft coverage. LDW more often includes theft, CDW may or may not. If theft is separate, it might be called theft protection, theft waiver, or similar wording.
2) Deductible or zero-excess level. Either waiver can be sold with a deductible (you pay the first portion of any claim) or as “zero” where the waiver removes your liability for covered losses. Confirm what you would actually pay if the car is damaged.
3) Associated fees and “loss of use”. Even with CDW or LDW, some contracts still allow charges such as administrative fees, diminished value, towing, storage, and loss of use. These can be significant if the car is out of service.
The key is to treat CDW and LDW as headings. Your decision should be based on the detailed coverage, the exclusions, and what your own travel insurance or credit card protection does and does not cover.
Exclusions you should always check
Most unhappy surprises in US car hire come from exclusions, not from the basic idea of a waiver. Before you pick up the keys, check these items in the rental conditions and at the counter if anything is unclear.
1) Tyres, glass, roof, and underbody
Many waivers exclude specific parts of the vehicle even when “damage” sounds all-inclusive. Common exclusions are tyres, wheels, windscreen and other glass, mirrors, roof damage, and underbody damage. These are frequent claim areas because they can occur without a collision, such as hitting debris, a kerb, or a low barrier.
If these parts are excluded, the rental company can charge you even if you purchased CDW or LDW. Some suppliers offer add-ons that cover glass and tyres, but read the scope carefully, especially for wheels and underbody.
2) Keys, locks, and roadside events
Losing the keys, locking them in the vehicle, or needing a replacement fob can lead to high charges. Likewise, a flat battery, fuel mistakes, or a puncture may be considered “roadside assistance” rather than “damage”, and may be excluded from CDW or LDW. Check whether roadside assistance is included, optional, or pay-per-use.
This is particularly relevant if your itinerary includes long drives or remote stretches. Someone collecting an SUV for winter driving via SUV hire in Boston might prioritise clarity on tyre, wheel, and roadside terms because winter road hazards increase these risks.
3) Unpaved roads and restricted areas
A frequent exclusion in US rental agreements is driving on unpaved roads, gravel tracks, beaches, forest roads, or any “non-maintained” surfaces. Some contracts also restrict travel into specific areas, such as certain desert routes, mountain roads, or locations where recovery is difficult.
If an accident or damage occurs in a prohibited area, CDW or LDW can be voided, leaving you responsible for the full cost. If your trip includes national parks or scenic routes, confirm in advance which roads are allowed. This is worth double-checking if you are hiring a van for a group road trip from van hire in Utah, where itinerary planning often includes rural drives.
4) Driver behaviour and contract breaches
CDW and LDW almost always stop applying if you breach the rental agreement. Typical triggers include:
Driving under the influence of alcohol or drugs, including prescription impairment.
Unauthorised drivers behind the wheel, even if they are a spouse or friend.
Using the vehicle commercially, for racing, towing without permission, or carrying hazardous goods.
Leaving the scene of an accident, failing to report damage, or not obtaining a police report when required.
These conditions are strict, and they are an area where travellers can assume a waiver will help when it will not. If there is any incident, follow the reporting steps in the contract, notify the supplier, and keep documentation.
5) Deductibles, deposits, and “authorisations” on your card
Even when CDW or LDW is included, you might still be required to provide a deposit or a card authorisation at pick-up. This amount can vary by supplier, vehicle category, and whether you have a zero-deductible waiver.
Check:
Deductible amount for each type of loss, damage versus theft.
Deposit or authorisation required at collection.
Eligible card types, some locations may not accept debit cards for certain categories.
What triggers charges, including cleaning, smoking, or late return.
This matters for airport collections where pick-up tends to be quick and busy. If you are arriving into Texas, reviewing the key terms in advance can reduce stress at the desk for car rental at San Antonio Airport.
6) “Loss of use”, administrative fees, towing, and diminished value
Even with a waiver, the supplier may reserve the right to charge certain costs related to an incident. These can include:
Loss of use, the estimated revenue while the car is being repaired.
Administrative fees for processing the claim.
Towing and storage after an accident or breakdown.
Diminished value, the reduction in resale value after repairs.
These are among the most misunderstood parts of US car hire agreements. Some waivers include them, some do not, and some third-party protections exclude them. If you rely on a credit card policy, check whether it covers loss of use and diminished value in the US, and what documentation is required.
How to compare CDW or LDW with your own cover
Many UK travellers have three potential layers of protection: the rental company waiver (CDW or LDW), third-party cover through a broker, and their own travel insurance or credit card benefit. The overlap can be confusing.
To compare properly, line up these questions:
What is covered? Collision damage, theft, vandalism, weather, animal strikes.
What is excluded? Tyres, glass, roof, underbody, keys, misfuelling.
What is your out-of-pocket cost? Deductible, fees, deposits, and claim handling.
Who pays first? Some third-party policies reimburse you after you pay the supplier, which means you still need funds available.
What documentation is required? Police report, incident report, photos, invoices.
For many travellers, the decision is less about whether CDW and LDW are “the same”, and more about whether the chosen waiver and any supplementary cover remove the financial risk you are comfortable with.
What to ask at the rental counter
Before you sign, ask for clarity on the exact items that cause disputes. Keep your questions specific:
Is theft included in this waiver, and what is the deductible?
Are tyres, wheels, glass, roof, and underbody covered?
Does the waiver include loss of use and administrative fees?
Are there restricted roads or areas where coverage is void?
What steps must I follow after an incident?
Also take time to document the vehicle condition at pick-up and return, including wheels, windscreen, bumpers, and the roofline if visible. Clear photos and a short video can prevent arguments later.
FAQ
Is CDW insurance on US car hire? CDW is usually a contractual waiver, not an insurance policy. It typically limits what the rental company can charge for damage, subject to exclusions and conditions.
Does LDW always include theft in the US? Often it does, but not always. Confirm whether theft is explicitly included, and whether there is a separate deductible for theft-related losses.
If I have CDW or LDW, can I still be charged anything? Yes. Common remaining charges include deductibles, excluded parts like tyres or glass, and fees such as loss of use or administration if not included.
What exclusions catch travellers out most often? Driving on unpaved or restricted roads, damage to tyres or wheels, underbody damage, lost keys, and failures to report an incident properly can all void or limit waivers.
Should I rely on my credit card cover instead of rental CDW or LDW? It depends on the card’s terms. Many policies exclude certain vehicles, countries, or fees like diminished value. Check what is covered, whether it is primary or reimbursement, and the documentation required.
