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Rental car hire by Australians and New Zealanders in the US

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I thought I would post this in the Australia and Pacific forum as I am trying to get responses from South Pacific Fodorites and thought they might frequent here more than the lounge.

DH and I are planning a trip to Hawaii in May. I checked our travel insurance policy re rental car cover, and they cover damage to the rental car, but specifically exclude the following

Cover does not apply:
(a) If You are in breach of any local driving laws or rules.
(b) If You have not hired from a licensed Rental Vehicle agency.
(c) If You have violated the terms of the Rental Vehicle agreement.

Losses We do not cover under Section 7

We will not pay for any claims arising directly or indirectly from:
(a) Loss or damage that occurs whilst driving the Rental Vehicle other
than on a formed or paved roadway or car park.
(b) Loss or damage that occurs whilst the Rental Vehicle is driven by a
person not covered on this Policy, or if You are not a named driver
on the Rental Vehicle agreement.
(c) Any damages, compensation and legal expenses for which You
become liable due to the use of a Rental Vehicle, causing bodily
injury (including death) of another person, or loss or damage to
property other than Your Rental Vehicle.

It is the last clause I am really worried about. Have any of you taken out additional insurance before you travel or do you just take it out when you rent the car, or not bother at all. Any suggested internet sites that specifically add comprehensive insurance.

Thanks for you help.

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