When Jennifer McIndoe signed on the dotted line for an Avis rental car she didn't realise the ramifications.

Like most people she signed without reading each and every one of the 3324 words in the agreement and she got a huge shock when a $2900 post-rental charge turned up on her credit card bill.

A hit-and-run driver collided with her hire car and McIndoe realised that she would have to pay the cost of repairs, which eventually amounted to $1600 plus GST. Avis, however, pinged her credit card automatically for far more than the cost of the actual damage.

"Avis told us we would receive a copy of the quote for repairs in two working days. Ten days later no quote but $2900 was taken from our credit card," says McIndoe. It took weeks of moaning to get a refund.

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McIndoe accepts that she was responsible to pay for the damage, but she was left feeling that she'd been taken to the cleaners.

"I do not like how they can just take your money in excess of the actual damage value," she says.

Avis didn't respond to a request for comment.

McIndoe's case highlights one of many fish-hooks faced by Kiwis who rent cars. Other examples include:

Eye-watering excesses

The insurance included in daily rental car charges comes with excesses of up to $5000. That will be deducted automatically from your credit card even if the other person was at fault and only refunded if the other party pays.

To reduce this excess you can either buy extra insurance from the rental company or take out a travel policy that will cover you for the excess, but not the basic repairs. Travel insurance is usually cheaper than the extra excess waiver cover from the car rental company.

Credit card insurance clauses

Sometimes credit card travel insurance will be sufficient to cover the rental car excess. But beware that you might be expected to include both the compulsory and extra "discretionary" insurance from the rental car company before the insurance kicks in.

The ANZ policy, for example, is limited in this way. ASB's credit card cover only requires that you've taken the basic insurance with the rental car company not the expensive add-on.

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Loss of use charges

Independent complaints body Financial Services Complaints Ltd (FSCL) investigated one case in 2016 where Kiwi traveller "Olivia" complained that her insurance company wouldn't refund a $696 "loss of use" charge on her credit card by the rental car company following an accident.

The rental car agreement required that hirers pay "all direct and consequential costs of repairing a damaged car, which includes a daily fee if the car is out of service. But her travel insurance policy excluded "consequential loss". She was left out of pocket and it's a lesson to others that rental cars can be costly beasts.

Other unexpected costs

The rental car company can dip into your credit card for the cost of retrieving its car if you're unable to yourself. This can be expensive if it's stuck in the back of beyond.

Thefts from rental cars

FSCL and the Insurance & Financial Services Ombudsman often adjudicate on claims where travellers have left valuables in the car and they have been stolen. Typically this is excluded.

Rental car excesses within New Zealand

Kiwis don't often think to take out domestic travel insurance, but it can be cheaper than the rental companies' extra insurance.

More insurance policies from companies such as 1Cover and Travel Insurance New Zealand are now offering domestic travel insurance. State Insurance offers an annual, multi-trip policy if you travel around the country regularly. Make sure you're covered for business use if you make work trips.

Underbody damage

Hire companies often have exclusions in their agreements which mean you have to pay the entire cost of overhead or underbody damage caused by collisions with bridges, tunnels, trees, boom gates of car parks, or driving over gutters, kerbs or pot-holed roads.

People who hire camper vans often get caught with the overhead damage clause because they're not used to the height of the vehicle.

No insurance at all

If you're travelling in the United States, in particular, be aware that most rental car deals don't include any insurance at all. That's because US drivers are usually covered by their own car insurance when they're in a rental vehicle.

Having an uninsured accident in the US can be incredibly expensive and your travel insurance only covers the excess, not the entire cost of the claim.

Excess holds

Be aware that some rental car agencies hold the full vehicle excess on your credit card for the entire time you're in charge of the vehicle. That can be a financial nightmare if you were relying on the card for spending money.

No one wants to read the fine print of their car rental agreement and travel insurance document. It's essential to do just that, however, if you plan to rent a car so that you are at least forewarned before you're stung with huge bills if your holiday turns to custard.

Exclusions that you could miss include the fact that you're not allowed to drive on unsealed roads within New Zealand and/or you might not be covered for specified roads including Skipper's Canyon and Ninety Mile Beach and all manner of roads and locations overseas.

In Australia, it's not uncommon for the basic rental car insurance to exclude driving in snow, or through streams and a number of named roads and remote parts of the country.