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- Never swapped to a lesser car
There are only two ways a replacement vehicle after a not-at-fault accident gets paid for. Either you pay and claim it back, or a hire company bills the at-fault insurer directly and you pay nothing upfront. Both are legitimate. They carry very different risks, and the difference is not always explained clearly at the point you are choosing.
Need a replacement now?
Tell us what is off the road and how you are funding it. We will be straight about which of our vehicles matches.
Option One: Pay Yourself and Claim It Back
You hire a vehicle on your own card and then recover the cost from the at-fault driver's
insurer as part of your damages.
Why people choose it
It is simple, there is no third agreement to read, and there is no argument about inflated
rates because you paid an ordinary retail price. If the claim is straightforward and liability is
admitted, this is often the cleanest route and the one least likely to generate a fight.
Why people do not
Cash flow. A prestige replacement over a six or eight week repair is a very large sum to carry
while waiting for reimbursement, and reimbursement is rarely quick. Most people simply cannot
fund it, which is precisely why the credit hire industry exists.
The practical protection it gives you
A retail rate you actually paid is far harder for an insurer to characterise as unreasonable
than a credit hire rate. Rate is one of the three things still genuinely contestable, and
self-funding largely removes it as an argument.
Option Two: Credit Hire
The hire company provides the vehicle, takes on the task of recovering the cost from the
at-fault insurer, and you pay nothing at the time.
Why it exists and why it is common
It solves the cash-flow problem completely, and for most not-at-fault drivers it is the only
realistic way to get an equivalent vehicle rather than whatever they can afford to fund
themselves. That is a genuine service and it is entirely legitimate.
Rates are higher, and there is a reason
Credit hire rates are typically above retail. The hire company is carrying the cost, the delay
and the recovery risk, and that is priced in. Understand that going in, because it is the single
most common point of attack on a large claim.
The clause worth reading twice
Most credit hire agreements provide that if the claim against the at-fault driver fails, or
recovers less than the full amount, you may remain personally liable for the shortfall.
The wording varies and some agreements are far more protective than others. This is the single
most important thing in the document and it is worth reading properly before signing rather than
afterwards.
Ask these questions before you sign
What happens if liability is not accepted? What happens if the insurer pays only part of the
bill? Am I liable for any shortfall, and is that capped? What is the daily rate, and how does it
compare with the retail rate for the same vehicle? Who decides when the hire ends?
A hire company that answers these plainly is one worth dealing with. One that talks around
them is telling you something.
Which One Suits Which Situation
Liability admitted, modest claim
Self-funding is usually cleanest if you can afford it. Fewer moving parts, no third agreement,
and no rate argument.
Liability admitted, large or long claim
Credit hire is often the only practical answer. Read the shortfall clause, keep the repair
documentation meticulously, and understand that the rate will be scrutinised.
Liability contested
This is where credit hire carries the most risk, because the shortfall clause is most likely to
be engaged. If fault is genuinely in dispute, get advice before entering a long hire on any
funding basis.
The other driver is uninsured
Recovery is against an individual rather than an insurer, which is slower and less certain. The
New South Wales Nominal Defendant scheme addresses personal injury under compulsory third party
insurance, not property damage or hire costs. Entering a long credit hire in this situation
without advice is a meaningful risk.
The Third Thing That Happens: The Insurer Offers You a Car
Frequently the at-fault driver's insurer will offer to arrange a replacement themselves rather
than have you hire one. This is a genuine third path and it is worth understanding before you
accept or refuse it.
Why they offer
It controls their exposure. They pay a rate they have negotiated with their own supplier rather
than a credit hire rate they will have to argue about later. From their perspective it is
sensible, and it is not inherently a trick.
Why it can suit you
There is no shortfall risk, no agreement to read, and no argument about rate. If the vehicle
offered is genuinely comparable to yours, accepting is often the path of least resistance and the
least likely to produce a dispute months later.
The thing to actually check
Whether the car offered is broadly comparable to what you lost. This is where the offer usually
falls short on a prestige claim, and it is the reason people end up in credit hire. If the vehicle
offered is not comparable, saying so in writing at the time, and explaining why, puts you in a far
stronger position than simply refusing it.
Do not simply ignore it
An unanswered offer of a reasonable replacement is a gift to the other side on the mitigation
question. If you are declining, decline with a stated reason and keep a copy.
What an Insurer Typically Challenges in a Credit Hire Bill
Three things, and they are the same three that remain live after the High Court decision, just
applied to a bill rather than a principle.
The daily rate, compared against retail for an equivalent vehicle. The
number of days, compared against the documented repair timeline. And whether the
vehicle supplied was genuinely comparable to the damaged one rather than an
upgrade. A claim with clean documentation on all three is a much shorter conversation than one
without.
What Neither Option Changes
How you fund the hire does not change your underlying entitlement. The principle from the High
Court's 2021 decision is the same either way: the reasonable cost of a broadly comparable or
equivalent vehicle for the period you are deprived of your own.
It also does not change what remains contestable. Rate, duration and comparability are live
under both arrangements. Funding affects who carries the risk and the cash flow, not the legal
test.
Documentation Matters Either Way
Whichever route you take, the same records decide the outcome. The repair timeline, the
assessor's report, the parts correspondence, the date you got your own car back, and a short note
explaining why you chose the replacement vehicle you did.
Under a credit hire arrangement it is tempting to assume the hire company handles all of that.
They handle the recovery. The consequences of a shortfall may still land on you, so keeping your
own copies is sensible rather than paranoid.
How We Work
We are a vehicle hire business. We are not a law practice, we do not run claims, and we are
not going to tell you which funding route to take, because that depends on facts about your
accident that we are not qualified to assess.
What we will do is tell you plainly what a vehicle costs, which of our cars is genuinely
comparable to what you were driving, and what the terms are before you commit to anything. If
you are dealing with a credit hire arrangement through another provider and want to know whether
a particular car is a fair match for yours, ask us and we will give you an honest answer.
If the replacement vehicle is booked
We never move you down a tier. If your dates are taken, these are the luxury cars we will offer instead, and we will tell you plainly if none of them is free rather than substituting something lesser on the day.
Range Rover Sport
- 294kW
- 5.9s
- AWD
- 5 seats
The kind of broadly comparable replacement the principle contemplates when the damaged car was a prestige SUV.
Mercedes-Benz GLS
- 243kW
- 6.3s
- AWD
- 7 seats
Seven seats, for when the car off the road was the family vehicle and a hatchback genuinely will not do the job.
Not sure which arrangement suits you?
It depends on the size of the claim and whether liability is clear. Worth a conversation before you sign anything.
General information only. Every claim turns on its own facts.
Frequently Asked Questions
What is credit hire?
An arrangement where the hire company supplies the vehicle and pursues the at-fault driver's insurer for the cost, so you pay nothing upfront. It exists because few people can fund weeks of hire while waiting for reimbursement.
Am I liable if the claim fails?
Frequently yes, at least in part. Most credit hire agreements provide that you may remain personally liable for any shortfall if the claim fails or recovers less than the full amount. The wording varies considerably, so read that clause before signing.
Why are credit hire rates higher than retail?
The hire company carries the cost, the delay and the recovery risk, and that is priced into the rate. It is legitimate, but it is also the most common point of attack on a large claim, so it is worth knowing going in.
Is it better to just pay myself?
If liability is admitted and you can afford it, self-funding is often cleaner. A retail rate you actually paid is much harder to characterise as unreasonable, which largely removes rate as an argument. The obstacle is usually cash flow.
What should I ask before signing a credit hire agreement?
What happens if liability is not accepted, what happens if the insurer pays only part, whether you are liable for a shortfall and whether that is capped, what the daily rate is against retail for the same car, and who decides when the hire ends.
Does the funding method change what I am entitled to?
No. The entitlement is the reasonable cost of a broadly comparable vehicle for the period you were deprived of your own, regardless of how the hire was funded. Funding changes who carries the risk, not the legal test.
What if the other driver has no insurance?
Recovery is against that person individually, which is slower and less certain. The NSW Nominal Defendant scheme covers personal injury under CTP, not property damage or hire costs. Entering a long credit hire in this situation without advice carries real risk.
Should I keep my own records under credit hire?
Yes. The hire company handles recovery, but a shortfall may still land on you. Keep the repair timeline, assessor report and parts correspondence yourself.
Is this legal advice?
No. This is general information about how replacement vehicle claims usually work in New South Wales. It does not take account of your circumstances and no solicitor-client relationship arises from reading it. For advice on your own claim, speak to a solicitor.
Does Drive Tribe run my claim?
No. We are a vehicle hire business. What we can do is supply a broadly equivalent replacement from a prestige fleet, and tell you honestly whether what we have is a reasonable match for what you were driving.