Does having a carnet absolve you of responsibility
 

Hi guys,
I read that having an insurance bought with the carnet does not absolve you of the responsibility of having to pay the 5 or 10 times the value of your vehicle it only gets you the carnet in the first place. So is it better to put the cash up front cos if you mess up its going to cost you the same either way. i hope you understand the question as it gails me to pay out for effectivly nothing
Nice one Tim

If you buy insurance you normally pay 10% of the total bond, and get half of that back assuming you dont lose the vehicle. If you do lose the vehicle, and assuming you cant pursuade the customs officials in the country concerned that it was stolen, you don't get the 5% back. But you dont pay any more.

In my opinion this is a bit of a scam. It seems to assume that the risk of people losing their vehicles is one in twenty. I'm sure the actual number is an awful lot less than that. I think it works on the basis that many people simply cannot raise the money in the first place.

It buys you a bit of paper that is recognised. The alternative is to pay the money at the border and then get it back as you leave. When you pay the money in, they will ask for a gift. When you get the money back ... they may keep some of it for a tax, transfer fee, commission, ... etc etc. Oh don't forget the exchange rate into their currency and back again... loose loose.

I'd rather have the bit of paper. Think it is the cheaper way.

Hobnob, I know what you are saying as I had the same thoughts. Yes my understanding is the insurance policy does NOT relieve you of having to pay the insurance company the bond. It only really covers the motoring organisation that issued the carnet.

Dont forget that if you put up the money yourself (to get the carnet I mean), that costs you money too - in interest you could have earned or that you are paying if you borrowed it.

I also looked into a bank indemnity, but that required me to borrow against my house loan and put that money in a seperate term deposit. I get interest from term deposit, but its about 2% less than what I am paying on the house loan. So it costs me about 2% of the amount I borrow/deposit. Guess what, the insurance premium here in Aus is 2% of the amount you get. So it will cost me the same, mmmm.... guess that how they come up with their insurance fees.

John

Nice one for the replies chaps
Some good observations, ive just worked out how much interest i would loose on the money if i put the bond up myself and you are right it costs the same as the insurance so i feel a little better knowing that i cant do it any cheaper myself. Lets hope the Truck doesnt get nicked cos hope do you prove a negative!!!!! to the carnet people
Tim

police reports! and get them to help you sort out the stamp in the carnet with the customs people.

Grant