Damage waiver

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Damage waiver (DW) or, as it is often referred to, collision damage waiver (CDW) or loss damage waiver (LDW) is a term that can be included or purchased as an option in a car rental agreement, by which the rental company waives the right to pursue compensation from the renter if the vehicle is damaged or stolen.^[1] Although it involves a transfer of risk, a damage waiver option is not insurance but instead a modification to the basic rental contract.^[2]

In many countries, it is a legal requirement to have a damage waiver included in the basic car rental rate. Some rental companies also offer liability insurance and coverage of towing charges. Terms and prices vary. Alternatives to the CDW include other car insurance policies, some coverage from credit card issuers (Visa, MasterCard, American Express etc.) and some travel insurance.