What is car insurance excess?
A car insurance excess is the amount you pay (or that is held back by your insurance company) in the event of anyclaim, regardless of who's to blame.
The excess will vary depending on your car, the age and experience of the drivers on your policy and if you have opted to take protected or guaranteed No Claims Bonus. You can also choose to add a voluntary excess - giving you more control over the cost of your insurance.
Whyshould you havecar insurance excess?
It's to deter people making lots of claims for minimal damage (such as a cracked door mirror) that nevertheless might soon add up. Insurance is there for the really big claims you probably wouldn't be able to pay yourself.
Let's say your policy has a £50 excess, and you're unlucky enough to have an accident. The cost of repair is £1,050, so we pay out £1,000, you pay the £50 excess and the bill is paid in full.
Or perhaps you've just suffered that broken door mirror. All it needs is a new lens, which is £20. As that's less than your £50 excess, you can't claim for it - but at least the cost of repair is affordable.
The excess makes sure your insurance is there to help when you really need it, for example to settle that £1,000 repair bill that would be more inconvenient to pay.
Nearly all policies come with two types of excess - compulsory and voluntary.
What is compulsory excess?
Compulsory excess is a fixed amount that you will have to pay in the event of a claim and the amount is set by your insurer. The figure can vary depending on driving experience, age and the type of car.
A new driver might have to pay a higher compulsory excess than a more experienced driver as they are viewed as a higher risk. While expensive performance cars could carry a higher compulsory excess than a standard make and model.
What is voluntary excess?
The voluntary excess is added to the compulsory excess - these figures together are the amount you will have to pay if you make a claim. But as the name suggests, you can choose how much voluntary excess you wish to pay.
By increasing your voluntary excess you may be able to bring your premium down, but bear in mind that you will have to pay this out if you make a claim.
Lower excess, higher premium or higher excess, lower premium? You decide, because you're in control.
When doyou pay excess on car insurance?
You pay the excess in the event of any claim made on your insurance policy regardless of who's to blame. However, if it's proved the accident was the other person's fault and the full cost is recovered from their insurer, you may be able to recover this amount.
FAQs
You pay the excess in the event of any claim made on your insurance policy regardless of who's to blame. However, if it's proved the accident was the other person's fault and the full cost is recovered from their insurer, you may be able to recover this amount.
How does an insurance excess work? ›
Insurance excess is the amount you have to pay towards the overall cost of an insurance claim. It's usually a pre-agreed amount. Your insurer will then contribute the rest – up to the limit of the cover. You'll see insurance excess on insurance products like travel, motor, home and health.
Do I get my excess back if it's not my fault? ›
Paying excess for a car accident that isn't your fault
When you pay the excess for a car accident which isn't your fault, you may need to claim this back from the insurance company of the driver who caused the accident once the claim is settled, if you don't have legal expenses cover to pay this for you.
Do you pay excess if someone claims against you? ›
Do I pay excess if someone claims against me? No. The good news is that you won't have to pay any excess – the amount you have to pay towards a claim – if a third party claims against you. You're only liable to pay an excess if you claim for repairs to your own vehicle.
What should I set my voluntary excess at? ›
You need to have an idea, when setting the voluntary excess, of how much you could afford to pay if such a large repair bill came about. And how much you'd be willing to pay to get those lower insurance premiums. If you can't pay the excess on a claim, the insurer may not pay out.
What is an example of excess in insurance? ›
Percentage of claim excess
For example, your insurer might say that you have a 10% of claim excess. So, if you have a claim of R100,000 you will contribute 10% of R100,000 (i.e. R10,000) and your insurer will pay the remaining R90,000.
How is excess paid? ›
An insurer sets your compulsory excess and you choose your voluntary excess. Both amounts are automatically added together and this is what you will have to pay in the event of making a claim. The amount of excess you pay when you claim may vary depending on: The voluntary excess amount you chose to pay.
Do you pay excess before or after repair? ›
When is a car insurance excess paid? If your car is repairable, we'll ask you to pay your car insurance excess before the repairs start. If your car is written off and we are paying you a total loss settlement, we'll deduct the excess from the final settlement amount we pay you.
How long does it take to get my excess back? ›
You can and should get any excess you had to pay out, recovered from the at-fault driver's insurer. However, depending on the complexity of your claim, this can take anything from a couple of months to several months to be returned. We know of drivers sometimes having to wait over a year to get their excess back.
How long does it take to claim back excess? ›
On average, once fault has been determined and all necessary documentation is provided, most insurers will aim to refund excess swiftly, with most aiming to take anywhere from a number of weeks to a number of months.
1. The excess amount is the first amount payable by you when your claim is settled or paid out. 2. It serves to motivate you to be more responsible, to take better care of your valuables and to prevent small, petty claims.
What does 250 excess mean? ›
Remember, this is the amount you'll pay on top of the compulsory excess set by your insurer. This means if you have a compulsory excess of £500 and you agree to a voluntary excess of £250, you'll pay a total of £750 up front for your car to be repaired after an incident.
What does 500 excess mean? ›
Let's say you have a collision and your car requires repairs costing £5,000. If your excess is £500, the insurance company will only pay £4,500 to the repair shop, leaving you to pay the remaining £500.
