If you have the time and the flexibility in your travel plans, exploring the 'Greater Phuket' area, encompassing Phuket Island, Khao Lak, Phang Nga, Krabi and Koh Lanta, by road will add hugely to your enjoyment. And there is no better way to do so than by renting a car.
Khao Lak and Phang Nga are just over one hour drive from Phuket, Krabi two hours and Koh Lanta up to four hours. Take your time and enjoy rural Thailand en route — but take care about how and where you rent your car.
While you may feel it's more fun (and possibly cheaper) to haggle on the side of the street with a 'grey' local car hire operator, we recommend that you use only the more established car hire companies.
Going into the 'grey' car hire market, the chances are you'll find yourself with no (or minimal) insurance, your passport may be held against return of the car in good condition and the chances of assistance should have an 'incident' are, at best, remote. If you're not asked to provide a copy of your international driving licence, you can be sure that you're not covered by insurance.
You should never surrender your passport to a car hire operator. The reputable companies will want copies of your passport and your international (or Thai) driving licence and will take an imprint of your credit card.