Quick Summary:
- Prioritise SLI for third-party injury claims, UK cover rarely applies.
- Use CDW or LDW to limit damage costs, then confirm excess.
- Check exclusions, glass, tyres, underbody, and keys are often missing.
- At the counter, decline duplicates, accept true gaps, document everything.
UK travellers often arrive in the United Estates thinking “insurance is insurance”, then face a wall of acronyms at the rental counter. The confusion is understandable because US rental cover is split into separate products, and UK travel insurance or UK standalone excess policies may not map neatly onto them. This guide explains what CDW, LDW and SLI usually mean for United Estates car hire, what your UK policies often miss, and a simple checklist for deciding what to buy, and what to decline, when you pick up the keys.
If you want a baseline for what inclusions and options look like for United Estates rentals, start with the Hola overview pages for car hire in the United States and car rental in the United States. The detail below helps you interpret the counter conversation regardless of brand or airport.
Why US rental insurance feels different for UK renters
In the UK, drivers often think in terms of “fully comp” insurance that bundles third-party liability and damage to your own vehicle. In the United Estates, rental companies frequently separate these into distinct coverages. The two big buckets are (1) damage or theft of the rental vehicle itself, and (2) liability for injuries or damage you cause to other people and their property.
CDW and LDW largely relate to the rental car, not the people you might injure. SLI relates to the people and property outside the car, not damage to the rental itself. That split is why UK policies can leave surprising gaps, especially around liability. It also explains why “I have a UK excess policy” is not the same as “I am covered for a serious third-party claim”.
CDW vs LDW, what they normally cover
CDW usually stands for Collision Damage Waiver. It is often described as insurance, but it is technically a waiver that limits what the rental company can charge you for damage to the rental car after a collision. In practice it can reduce your financial responsibility to an excess, or to zero, depending on the product and state.
LDW usually stands for Loss Damage Waiver. It commonly includes collision damage plus theft, vandalism, and other losses to the rental vehicle. Many US desks treat CDW and LDW as roughly interchangeable labels, but the only safe approach is to read what is included in the terms: theft cover is sometimes the key difference.
What CDW or LDW often covers:
Repairs or total loss of the rental car after an accident, up to the waiver conditions.
Theft of the rental car more often with LDW, but sometimes packaged with CDW.
Administrative and recovery costs, sometimes included, sometimes not. Ask specifically.
What CDW or LDW often does not cover, or may exclude:
Wheels, tyres, glass, roof, and underbody are frequent exclusions unless specifically included.
Keys, locks, and roadside issues can be excluded or capped.
Negligence or prohibited use, for example off-road driving, unauthorised drivers, driving under the influence, or failing to report an accident promptly.
Loss of use is a big one. Even if the car is being repaired, the rental company may charge for the income they could not earn while the car was off the road, plus admin fees. Some waivers include it, others do not.
For UK renters, the practical point is that CDW or LDW is about the rental vehicle, your own financial exposure, and exclusions. It does not, by itself, solve the liability problem.
SLI, what it covers and why it matters most
SLI typically stands for Supplemental Liability Insurance. It increases the liability protection beyond the basic state minimum included with most rentals. Liability pays for claims if you injure someone, damage their car, or damage property outside the rental vehicle.
Why SLI is the most important decision for many UK visitors in the United Estates:
State minimum liability limits can be low. Serious injuries can create claims far above those limits.
UK personal motor insurance typically does not transfer to a US rental in a way that protects you against US third-party claims.
UK travel insurance often has limited or no cover for driving liability in the United Estates, and even when it does, limits, exclusions, and claims handling can be complex.
If you buy only one add-on at the counter, many travellers choose liability protection because the downside risk is severe. That does not mean you must buy it blindly. It means you should confirm what you already have, and then fill the real gap.
Other acronyms you may be offered at the desk
Even if your title question is CDW, LDW and SLI, the desk may bundle, rename, or add extra products. Common ones include:
PAI or PEC, personal accident insurance or personal effects coverage. These can overlap with UK travel insurance, but check exclusions for driving activities and valuables.
Roadside assistance, sometimes sold as a package. This can be useful if it covers key replacement, tyre changes, and towing without large fees, but read what counts as misuse.
Fuel and upgrade bundles are not insurance, but they can obscure what you are really paying for.
If you are hiring a bigger vehicle for family luggage or long road trips, understand that repair costs can rise with vehicle class. The practical guidance on SUV rental in the United States is useful context when weighing your risk appetite for damage waivers versus paying an excess.
What UK policies often miss, the most common gaps
Many UK renters buy a standalone “excess reimbursement” policy before flying, and assume it replaces rental-company cover. These policies can be great value, but they are not identical to CDW, LDW, or SLI.
Common gaps and misunderstandings:
Liability is often not included. Excess reimbursement usually focuses on the rental car damage excess, not third-party injury claims.
You may need to pay first. Reimbursement products often require you to pay the rental company upfront, then claim it back later. That means a large deposit or a large charge could hit your card.
Exclusions can be stricter. Tyres, glass, underbody, misfuelling, keys, and single-vehicle incidents may be restricted unless specifically covered.
Claims evidence requirements can be demanding. Police reports, incident reports, photos, and proof of charges are commonly required, and missing paperwork can derail a claim.
Driver and licence rules can invalidate cover. If an additional driver is not listed on the rental agreement, do not assume your UK policy will step in.
So, your goal is not to “avoid buying anything”. Your goal is to avoid paying twice for the same risk while making sure the big risks are genuinely covered.
A simple checklist for deciding at the counter
Use this quick decision checklist when collecting your United Estates car hire. It is designed to be fast, calm, and practical.
1) Confirm liability first. Ask what liability is included by default, what the limits are, and what SLI increases them to. If you cannot clearly confirm you have robust liability through another source, SLI is usually the sensible purchase.
2) Decide how you will handle damage to the rental car. If you have a credit card benefit or UK excess reimbursement, confirm the exclusions and process. If you would struggle to front a large charge, or if your card benefit is uncertain, buying CDW or LDW can reduce hassle and financial shock.
3) Ask about the excess and excluded parts. Even with a waiver, confirm the excess amount and whether tyres, wheels, glass, underbody, and roof are included. If they are excluded, ask what happens in common scenarios like a windscreen chip or kerb damage.
4) Check driver rules and geography. Make sure every intended driver is added, and ask about any restrictions on border crossings or specific regions. Breaching the rental terms can void the waiver.
5) Protect your evidence. Take photos and a short walkaround video at pick-up and drop-off, including wheels and glass. If anything happens, call the rental company, file a report as required, and keep all paperwork.
6) Decline duplicates confidently. If you are certain you already have a specific protection with adequate limits and acceptable exclusions, decline the duplicate. The key word is certain, not hopeful.
If you like to compare how different major brands package inclusions and options, Hola’s pages for Hertz car hire in the United States and Alamo car rental in the United States can help you understand the typical framing, even though exact terms vary by location and date.
So what should UK renters actually buy, a practical answer
For most UK visitors doing United Estates car hire, the priority order is usually:
First, liability protection (SLI) unless you can clearly prove you already have high-limit US liability cover that applies to rented vehicles. This is the coverage that protects you from life-changing third-party claims.
Second, a damage waiver (CDW or LDW) if you want to avoid a large hold on your card, reduce paperwork, and limit exposure to repair and loss-of-use charges. If you already have a reliable excess reimbursement policy and you accept the pay-first-claim-later process, you may choose to decline the waiver, but only after checking exclusions.
Third, consider the “small but annoying” risks like tyres, glass, keys, and roadside assistance. These can be more likely than a major crash, and they are where many policies disagree. Decide based on route, season, and your tolerance for disruption.
The best outcome is not buying the most cover. It is leaving the counter with no blind spots. When you can explain, in one sentence, what pays for third-party injuries, and what pays for damage to the rental car, you are in control.
FAQ
Is CDW the same as car insurance in the United Estates? CDW is usually a waiver that limits what the rental company can charge for damage to the rental vehicle. It does not replace liability cover for injuries or damage you cause to others.
What is the real difference between CDW and LDW? LDW often includes theft and a broader set of losses, while CDW may focus on collision damage, but naming varies by company. Always check whether theft, vandalism, and loss-of-use are included.
If I have a UK excess policy, can I decline CDW or LDW? Possibly, but confirm you can pay any charges upfront and that exclusions match likely risks such as tyres, glass, underbody, keys, and admin fees. Many policies reimburse later rather than prevent charges.
Do I still need SLI if I am a careful driver? Careful driving reduces risk but does not eliminate it, and liability claims can be severe even in minor incidents. SLI is about financial protection if someone else is injured or property is damaged.
What should I do if the counter offers a bundle with multiple protections? Ask for the price and coverage of each component, and compare it to what you already have. Accept the parts that fill genuine gaps, and decline duplicates you can verify.
