Our insurance company requires that we take a £500 security deposit from hirers. (£750 for overseas licences.) This is designed to cover the excess associated with the insurance policy. What this means in practice is that should you damage the van, it’s contents or third party property you’ll be liable for the first £500 (or £750) of damage caused.

The normal way for rental companies to take a security deposit is via what is called a ‘pre authorisation’ on a credit card. What this means is that the hire company has the ability to request up to £500 from the hirers credit card in the event of damage. That is what we normally do with hires that are up to a week. Where hirers don’t have a credit card we’ll need the security deposit in cleared funds either via bank transfer or a cleared cheque. We are not allowed to accept security deposits in cash as our insurers require that they are ‘trackable’.

When it comes to hires that are longer than a week we are unable to accept a security deposit via a credit card pre authorisation. This is because a pre authorisation runs out after a ten day period. What that means in effect is that if we take a pre authorisation for the security deposit and the van is out for longer than a week then we are not meeting the requirements of our insurers and therefore we are uninsured. So, we have to ask that for hires of over a week the security deposit is paid by means of cleared funds – either bank transfer, cleared cheque or credit / debit card payment.

Why a week and not ten days? Because we need to get the van back and check it over and then have time to report and process damage.

We have talked to both insurance companies and the companies that provide credit card facilities. This seems to be an industry wide issue which neither the insurance companies or the credit providers are able to help with. We know this is not ideal for hires that are longer than a week. Anybody out there with any industry expertise on this please feel free to offer up better solutions!