Insurance and Deposit: What the Letters Mean

Basic cover is always included, but it does not mean “you pay nothing”. It caps your liability at the excess: €100–300 with local rental companies, €300–1,000 with the international chains. That is the amount you lose in a serious incident even when the fault is not yours.

The deposit is a separate figure, and it depends on the type of company. Local companies take a deposit of €100–300, and some cars come with no deposit at all. International chains block €900–2,000 on a credit card.

Here are the letters, because they are all over the contract.

CDW — the basic waiver

Collision Damage Waiver. The company waives its right to charge you the full cost of body repairs. Included by default.

Note what it is: not insurance in the everyday sense but a cap on your liability. Crack a bumper and you pay the excess — say €300 — not €2,000 for the repair.

TP — theft protection

Usually included too, and it works the same way: if the car is stolen you lose the excess, not the value of the car. The condition is that keys and documents were not left inside.

The excess is the number that matters

It is your maximum loss per incident. Check it before signing: local companies usually set it at €100–300, international chains at €300–1,000.

The deposit is the security held against that liability, and there are two sets of figures. Local companies take €100–300, and some cars come with no deposit at all; you get it back on the spot when you return the car. International chains block €900–2,000 on the driver’s credit card. The money is not charged, only blocked, and the release after you hand the car back takes 5 to 30 days. If your card limit does not cover it, you do not get the car: this is the single most common reason a pick-up fails.

Super CDW — the extra that zeroes the excess

For a supplement from €8–15 a day the excess drops to zero or to a token €100. The deposit is then either not blocked at all or reduced to a symbolic amount.

Worth it? Over a week that is €60–100 on top. Reason it out: if your trip involves switchbacks, the narrow lanes of old towns and parking in August, take it. If you are driving the coastal road from hotel to beach, probably not.

One separate argument in favour: without it, an international chain needs €900–2,000 of free limit on your credit card, and that stays frozen for the whole holiday.

What no insurance covers

This list is nearly identical across companies, and it matters more than the acronyms:

• Tyres, wheels, glass and mirrors — unless bought as a separate option.
• Underbody and suspension — in other words, what gravel roads do. The tracks to Durmitor and to several viewpoints are exactly that.
• The interior: burnt seats, sand, pet damage.
• Wrong fuel — petrol into a diesel and you pay in full.
• Driving without the right licence category or under the influence — cover is voided entirely.
• Crossing a border unannounced. You may only leave the country with the rental company’s written permission: without it you face a €300–500 penalty and lose your cover. Croatia, Bosnia and Albania need a Green Card as well; without it cover does not apply and you get turned back anyway.

The Green Card

Planning Dubrovnik or Mostar? Say so when booking. The Green Card is arranged in advance and at most companies costs €25–50 per rental. You cannot buy it at the border on your way out.

If the car is damaged

The sequence is strict, and whether you are charged depends on it:

1. Call the police. In Montenegro insurers do not act without a report.
2. Call the rental company and tell them what happened.
3. Do not leave the scene before it is documented.

A full walk-through with emergency numbers is in a car accident in Montenegro. If the car has been towed, that is a separate story: car towed in Montenegro.

What it looks like in practice

An economy car for a week in May: from €175 for the car, about €70 for super CDW, no deposit blocked. From €245 in total and a calm holiday.

The same hire without super CDW from an international chain: from €175, but €900–2,000 frozen on your credit card until the end of the trip and for 5–30 days after. With a local company and no super CDW the deposit is €100–300, and you get it back when you hand over the keys.

What to check when signing, and how to photograph the car, is in rental car pitfalls. How to choose a company without overpaying is in how to book a car online. Current offers are on the car rental page.

If you do not need a car

Deposits and excesses are the price of freedom of movement. If your plan is two or three trips inland, an excursion is cheaper and calmer: a coach, a guide and no liability for someone else’s bodywork. Formats and prices are under things to do. The sea half of the holiday is covered by a skippered yacht — there, too, the responsibility is not yours.

Excess amounts and option prices vary by company and by season. Check the figures in your own contract. Prices checked in September 2026.