Every hire carries some risk: spills, tears, broken zips, late returns. Dress hire businesses usually manage that risk with a refundable bond, a rental insurance add-on, or both. This guide compares them.
What is a bond?
A bond is extra money the customer pays at booking and gets back when the dress is returned on time and undamaged. If something goes wrong, you can keep part or all of it to cover the cost. See how much bond to charge.
What is rental insurance?
In dress hire, "insurance" usually means an optional, non-refundable add-on the customer pays for peace of mind. It typically covers minor accidental damage (as defined in your terms), so the customer isn't charged for that damage from their bond.
Check your wording. A damage protection add-on you run yourself isn't necessarily an insurance product. Depending on where you operate, calling it "insurance" may have legal implications, so consider names like "damage protection" or "damage waiver" and get advice on your terms.
Bond vs insurance at a glance
| Refundable bond | Insurance / damage protection | |
|---|---|---|
| Refunded? | Yes, if no issues | No, it's a fee |
| Revenue for you | None (it's held, then refunded) | Yes, on every hire where it's added |
| Customer's upfront cost | Higher | Lower |
| Covers | Anything your terms allow you to deduct | Only what your terms say it covers |
| Admin | Inspect and refund every hire | Handle claims when damage occurs |
| Best for | Deterring careless use and late returns | Lowering upfront cost and adding revenue |
When a bond makes sense
- Your stock is high value or delicate.
- Many hires are posted to customers you've never met.
- Late returns are a bigger problem than damage.
When insurance makes sense
- Customers are put off by high upfront costs.
- You want extra revenue per booking.
- Most issues are minor accidents such as small spills or loose threads.
Using both together
Many hire businesses combine them: a refundable bond for every hire, plus optional insurance that covers minor accidental damage. Customers who add insurance are less likely to lose part of their bond, and you earn on the insurance fee. Some businesses offer a lower bond when insurance is added.
Whichever you choose, spell out in your hire terms:
- what counts as normal wear, minor damage and major damage,
- what the insurance does and doesn't cover,
- what happens with late returns and losses, and
- how and when bonds are refunded.
Setting up both in The Dress Rental App
- Bond: go to Settings → Rental → Bond Default and choose a flat or percentage bond. Rental settings
- Insurance: go to Booking Fields & Add Ons → Add-ons, enable insurance, and set the label, price and description of what it covers. Insurance and add-ons
- Terms: add your hire terms URL and tick Require terms read at cart. Terms checkbox
- When something goes wrong: refund bonds and record damage claims with photos from the booking. Customer disputes
Frequently asked questions
Can I offer insurance instead of a bond?
Yes, but insurance usually only covers minor accidental damage. Without a bond you have less protection against late returns, major damage or loss, so make sure your terms cover those.
Should insurance be optional?
Most businesses make it optional, so customers can choose between a lower upfront cost and more protection.
How much should I charge for rental insurance?
Price it low enough that it feels like an easy add-on but high enough to cover the repairs you expect over many hires. Review it against your actual damage costs in the profit tracker.
Can I name it something other than insurance?
Yes. The Insurance Label in the app can be anything, such as "Damage protection".
