Car hire companies are charging extortionate fees for insurance on their cars, new figures from moneymaxim have revealed.

The car hire insurance comparison website found that insurance purchased from the companies is – in terms of 'real benefit' – one of the most expensive forms of insurance around.

Customers are charged on average £10 a day, translating to £3,650 a year, covering a total excess that can only be £1,500 and often even less.

Managing director of moneymaxim.co.uk, Mark Bower, said, "One example we found was a case from European car rental giant Sixt. The cost of extending collision damage and theft waivers to reduce the excess payable to €500 in the case of an incident was an incredible £123.28 for a week's hire. That is equivalent to an annual premium of £6,410 for a policy with a maximum benefit of €1,500!"

Searches on moneymaxim.co.uk have found policies reducing the excess to nil, and covering the vehicle’s wheels, tyres, glass and underbody — for as little at £13.30 for 7 days cover, or less than £40 for an annual policy.

Bower continued, "Car rental companies often offer a poor product that typically fails to protects customers from extortionate excess charges for very minor damage.

“Thanks to the markets we can expect less Euros and Dollars for our pounds when we head abroad this summer, so making savings wherever possible through things like car hire insurance is always advisable."

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