What is SLI?

SLI or Supplemental Liability Insurance is a form of insurance that protects the policyholder against large third party claims. In some countries this is also known as additional liability insurance or ‘ALI’ and there may be other national or local variations.
 
When hiring a car, the basic rental cost may include some form of third party insurance. What this means is that if the driver has an accident and this results in third party claims for damages or injuries etc, then the car rental policy will protect the driver by paying some of any amounts awarded.

In some countries (notably the UK) the law demands that this cover is included in the car rental agreement and is unlimited in terms of the financial amounts covered.

It is critically important to note though that this does NOT apply in many other countries including the USA. In such countries the cover that comes ‘as standard’ with the car rental agreement may be capped at a certain maximum payout level. This level could well be significantly lower that the amount a court may choose to award the third party in some circumstances.

To be clear, if the basic third party insurance that comes with the vehicle is capped at a maximum amount of say 250,000 US dollars but a court awards 500,000 US dollars, then the difference of 250,000 US dollars could be payable directly by the renter.

The basic third party liability cover included will vary from country to country and by car rental company. The details of this ‘in the price’ basic cover should be carefully checked on the rental company’s documents or web site before the booking is confirmed.

In a given situation, if the renter is uneasy about the extent to which they are covered for third party liabilities then there is the option of purchasing additional SLI.

Most SLI policies will offer third party liability cover up to a maximum of 1 million US Dollars. They can be purchased from the car hire company at the time the vehicle is hired, usually by ticking the appropriate box on the rental form. It should be done at that stage, as it may be impossible to add the cover half way through the rental period. The costs will normally be calculated on an amount per day basis and added to the rental bill.

All SLI policies will have their own conditions, terms and exclusions. As with all insurance products, these should be carefully read and studied in detail before purchase to ensure that the policy is suitable for the car hirer’s needs.