Depending on which Company you choose to hire a car from and the type of vehicle you hire, the base insurance excess (sometimes referred to as deductable or liability) may range from around NZ$1500 to NZ$3500.
Typically the conditions on your rental car agreement will state that you are liable for the insurance excess amount regardless of fault which is a very important point to consider when renting a vehicle in New Zealand as vehicle insurance is not compulsory. What this means is that if your vehicle is involved in an accident with the driver of an uninsured vehicle, and the other driver is at fault, there is no guarantee that you will be able to recover the costs of damage from the other driver. In the case of a Rental Car, as the hirer you will still be liable for the excess amount to the Rental Car Company.
As a Rental Customer you have a few different options. Before travelling to New Zealand you may choose to purchase a Travel Insurance policy which includes coverage for Rental Vehicles. It is important to check all policies carefully for conditions and exclusions. Alternatively you may choose to lower your insurance liability by paying an additional fee to your chosen Car Hire Company. Most Rental Car Companies will offer you the option of reducing your liability down to around NZ$250. The other option that some travellers choose is to hire a car with the base level of excess liability.
A number of Rental Car insurance policies exclude coverage for damage to vehicle glass and windscreens as well as tyres. If you are concerned about these, then ask the rental company whether they can be covered.
In the event that your vehicle is involved in an accident, damaged, or stolen, it is important to record as much information as possible about the incident including dates, times, location, details of other vehicles and people involved, witness contact details, and any other relevant information. Taking photographs is a very good way to record information. It is important to contact your Rental Car Company as soon as possible and make sure that you follow their instructions regarding the recovery, repair, or replacement of the vehicle.
For peace of mind, and especially for people not familiar with New Zealand roads or driving conditions (which can be very challenging for inexperienced drivers), we would recommend taking rental vehicle insurance. The key thing is to make sure that you read the terms and conditions of your rental agreement carefully, and ask for clarification of anything that you are not sure of.