Car rental insurance in Japan: CDW and NOC explained

In Japan, even when the rental car’s insurance applies to an accident, you may still have to pay two charges: the insurance deductible (also called an excess) and the non-operation charge (NOC), a fee for the time the car is off the road. The collision damage waiver (CDW) brings the deductible to zero, but the NOC is usually billed separately. To remove both, choose a plan that also waives the NOC. If the insurance does not apply at all, for example after drink-driving, you pay the full cost of the damage.

At the last step of a Japanese booking form you are often asked whether to add “menseki hosho” (免責補償), the collision damage waiver. It costs about ¥1,000 to ¥2,000 a day, and you can rent without it. This article starts with what you would pay without it, then explains how to decide.

Two charges remain even when insurance applies

Rental rates in Japan already include motor insurance. Injury to other people, damage to other vehicles and property, and damage to the rental car are paid from this insurance, within set conditions and limits that differ by company and plan. Two things can still be charged to you.

Charge	What it is	Typical amount
Deductible (免責額)	Your share when the insurance is used. It applies separately to third-party property and to the rental car	About ¥50,000 each (¥100,000 for some vehicle classes)
NOC (non-operation charge)	Compensation for the days the car cannot be rented out while it is repaired or cleaned	¥20,000 if you drive the car back, ¥50,000 if you cannot

Amounts vary by company and vehicle. These are common figures at the large national companies. If the insurance does not apply, you also pay for repairs and towing; see the section on exclusions below.

Suppose you scrape a pillar in a car park and also damage someone’s property. Without the CDW you would pay around ¥100,000 in deductibles plus a ¥20,000 NOC: about ¥120,000 in total.

The CDW removes the deductible only

The CDW brings the deductibles in the table above to zero. It usually costs ¥1,100 to ¥2,200 a day, for every day of the rental.

The part people miss is the NOC. With the CDW alone, the NOC is normally still charged. To waive it too, companies sell an upgrade with names such as “NOC cover”, “full support” or “safety pack”. The names differ, so check two things:

1. Do the deductibles (property and vehicle) become ¥0?
2. Does the NOC become ¥0?

How to decide

If in doubt, take it. Over three days the CDW costs ¥3,300 to ¥6,600 in total. In the example above, going without it costs about ¥120,000 (the amount depends on the company, the vehicle and the accident). Japan drives on the left, the roads and the car are unfamiliar, and small knocks are more likely than at home.

Some travellers plan to rely on travel insurance or a credit card. If you do, confirm these points with your insurer or card company before you leave:

• Does it cover damage to a rental car in Japan?
• Does it cover Japan’s non-operation charge (NOC), sometimes described as a loss-of-use charge? Coverage varies.
• Do you have to decline the rental company’s CDW for the cover to apply?
• Do you have to pay in Japan first and claim later, and which documents will you need?

If checking is a chore, the simple route is a rental whose price already includes both waivers. Then there is nothing to decide at the booking screen.

When your cover does not apply

Even with a waiver, coverage does not apply in cases like the following, and you pay for the damage in full. These are typical exclusions at most companies. Details differ, so read the terms of the company you rent from.

• You did not report the accident to the police and to the rental store. Without a police accident report, the insurance cannot be used
• You settled privately with the other party
• Someone who was not declared as a driver at pick-up was driving
• Drink-driving or driving without a valid licence
• Driving on a beach or anywhere that is not a road
• Using the car beyond the return time without permission

On Miyakojima, beaches are the one to remember. It is tempting to drive down onto the sand, but cars get stuck and the cover does not apply. Park in the car park and walk down.

After an accident: help anyone who is injured, call the police (dial 110), then call the store. Calling the police at the scene, even for a small scratch, is a condition of the cover.

Check your driving documents before you travel. Foreign visitors must bring their passport and original driving documents. Depending on the issuing country or region, this means either an International Driving Permit under the 1949 Geneva Convention, or an eligible home licence (Switzerland, Germany, France, Belgium, Monaco or Taiwan) with an authorised Japanese translation. You may drive for up to one year from the date you entered Japan, or until the licence or permit expires, whichever is earlier. Without valid documents you cannot rent, and no insurance applies. See our FAQ.

Punctures and lost keys are often separate

Puncture repairs and lost or water-damaged keys are often outside the CDW and charged at cost (some companies cover them in a higher plan). Roadside help at the scene, such as fitting the spare tyre, may be covered by roadside assistance.

At the beach, keep the key dry. Use a waterproof pouch, or leave it with someone who is not swimming.

At Luana Rent a Car

Our displayed price includes the Anshin Pack: both deductibles waived, the NOC waived, and roadside assistance. There is no separate fee for the Anshin Pack and no additional cover to select on the booking screen.

Item	Normal charge	With the Anshin Pack
Property-damage deductible	¥100,000	¥0
Vehicle deductible	¥200,000	¥0
NOC, car driven back	¥30,000 (¥80,000 for the premium class)	¥0
NOC, car cannot be driven back	¥50,000 (¥100,000 for the premium class)	¥0

This applies to all plans booked on this site or the booking system (monthly rentals and some plans on other booking sites differ). Drivers who have held their licence for less than one year may not be eligible for the deductible waiver, so please tell us when you book. Puncture repairs are at your expense, but emergency help such as fitting the spare is handled by roadside assistance. The main exclusions and at-cost items are listed on our Insurance & Coverage page.

Frequently asked questions