Purchase the CDW when offered auto insurance from the rental company for short-term stays

One quick, easy way to ensure that you are covered completely when it comes to your rental car is to buy the "Collision Damage Waiver" from the rental car company. A few countries, like Italy, require you to purchase it from the rental company before driving, but in most countries you are given the choice. Although it can be expensive (about 10 to 25 euros each day), buying it when you first pick up the car will enable you to get it over with and be fully covered immediately. Taking this route is best when you plan to stay in Europe for just a few days or weeks.

I recommend: CarRentalExpress.com allows you to just pick the country in which you need car rental insurance and provides you with many options, while Gemut.com specializes in car rentals in a Germany, Austria and Switzerland.

Get information on European car insurance if you're from the UK

If you are permanently relocating to another part of Europe for a job from the UK, you will need to purchase regular car insurance. European car insurance companies abound; you just need to find one with which you will be satisfied. There are also car insurance companies that provide insurance exclusively in the UK.

I recommend: Chubb Insurance Company of Europe offers car insurance for residents of the UK. Get a quote from PhaCar.com, which offers UK car insurance. CarInsurances.co.uk explains that for short-term stays in other parts of Europe, UK car policies are in effect.

Use different European car insurance providers if you are from the United States

Most U.S. policies will not cover you when you are overseas.

I recommend: Ezilon.com has a comprehensive directory of European car insurance providers. Budget Insurance is a good bet, as is AIG Europe, a reputable and affordable choice that offers insurance policies all over the world.