Many rental companies use “free cancellation” as a means to attract their target customers. But don’t be taken in too fast by the term “free” in it because it may not mean what you think it does! The actual meaning of free cancellation in contracts vary widely so it’s best to be aware.
Read the T&C
Free cancellation in a rental car contract comes with its own terms and conditions. You may not want to read the fine print and ask questions but if you value your money, you should start doing these things. You may or may not be able to get your money back depending on these terms and conditions, which usually include when you booked the car and when you cancelled it.
If in doubt, ask the staff about the cancellation policy. You may be unsure whether your trip will push through or not so you have to be clear about it. Otherwise, you should be prepared to say goodbye to part of your reservation money.
Refund, Full or Partial
In general, car rental companies mean one of two things when they use free cancellation in their contracts. First, the customer may avail of free cancellation within a fixed period after booking.
For example, you may get all of your reservation money back if and when you cancel within seven days after booking. But if you cancel after the seven-day period for free cancellation has elapsed, you will be charged a cancellation fee. You will still receive a refund but the cancellation fee will be deducted from it; the cancellation fee should be clearly stated on the contract.
Hertz usually offers this kind of arrangement.
Second, the customer can avail of free cancellation until a fixed time before travelling. You will get your full refund if you cancel your booking for a fixed time before you are due to pick up your rental car. For example, you can cancel for free for up to 72 hours before the target pick-up time; some rental companies allow for a 24-hour window for cancellation.
Keep in mind that the pick-up times stated by rental companies are always in local time. If you’re travelling from afar or from abroad, you should consider the time difference so you don’t miss the free cancellation window.
Again, if you fail to meet the cancellation window, you will be charged a cancellation fee. You will get your refund less the fee, which may or may not be nominal in your view.
The bottom line: Free cancellation can, indeed, be free but you have to be aware of the fine print that comes with it.