Car insurance: Compulsory and voluntary excess explained
What is car insurance excess?
Car insurance excess is an amount of money you need to pay if you want to make a claim, but you only have to pay it in certain circumstances. It’s made up of two parts — compulsory excess, and voluntary excess and you must pay both to start a claim.
Here’s how it all works:
What is compulsory excess?
As it implies, compulsory excess is an amount you must pay before your claim can go ahead. It’s set by your insurer and is based on different factors like the type of car you drive and its age.
You have no say over compulsory excess, but different insurers will set varying amounts. With that in mind, it’s a good idea to compare a wide range of quotes before taking out a policy.
What is voluntary excess?
Voluntary excess can be a little misleading, as it’s not voluntary in the sense you can choose whether to pay it or not. You still have to pay the voluntary excess for a claim to proceed but you agree to the amount with your insurer when you take out your policy.
When you compare car insurance policies, you can experiment with different voluntary excess amounts by changing the value. You’ll usually be able to pick an amount from within a range — for example between £100 and £500.
Generally speaking, the higher your voluntary excess, the lower your overall premium. Whatever amount you choose still needs to be affordable because you won’t be able to proceed with a claim without paying it.
Windscreen cover often extends to other glass on the car, which is useful.
Whether you need to actually pay your windscreen excess depends on the kind of damage. If the screen is damaged beyond repair, the excess will usually be less than £150. For a simple repair job, the excess is likely to be less than £50, or even free.
How does car insurance excess work?
You only need to pay your excess if you’re claiming for damage to your own car, for example:
- If an accident is your fault.
- If your car is stolen.
- If your car is fire damaged or considered a write-off.
Bear in mind that your insurer could still ask you to pay the excess in certain circumstances, for example:
- If someone else caused the accident — some insurers will ask you to pay the excess at the start of the claims process regardless of who was at fault. You’ll get your money back when they’ve established beyond doubt that the other person was to blame. In some cases, insurers will waive the excess completely so you won’t need to pay anything at all.
- If the other driver was uninsured — unfortunately if you have an accident with an uninsured driver, you could end up paying the excess in order to claim repairs to your own car. However, some insurers will protect you from this and either waive the excess, protect your no claims bonus or do both so that you don’t lose out.
When do you pay excess on car insurance?
Insurers set their own terms and conditions so some insurers will ask you to pay the excess at the start in order to kick-start the claims process whereas others will deduct it from the payout you receive.
Are there other types of car insurance excess I should know about?
In some instances, insurers will also have other types of compulsory excess but these will be clearly set out in your policy, examples include:
- Young driver excess — drivers under 25 are statistically more likely to be involved in an accident and are considered a greater insurance risk. To cover this risk, insurers sometimes ask young drivers to pay an excess.
- Performance, sports or imported cars — you could pay an added excess if your car falls into one of these groups.
- Windscreen excess — you might have to pay a small excess if your windscreen needs replacing although if it can be repaired, you may not have to pay anything.
Compare car insurance excess to get the best deals on car cover
Excess can play a big part in the overall cost of your car insurance so it’s well worth playing around with different amounts to see what the effect on your premium will be. Just always remember that the value should be affordable because in many cases you’ll need to pay it before any kind of claim can go ahead.
To start your search and compare how excess can change the cost of your car cover, simply fill in our online quote form.
Why does car insurance excess exist?
Excess exists to stop people from making lots of claims for minor damage. That might sound contrary to the point of insurance but premiums for everyone would probably be a lot more if insurers had to pay out for every little bump or scratch. After all, you’re more likely to think twice about making a claim for a £200 dent if your excess is £300.
Can I change the excess amount?
You can’t change the compulsory excess as this is set by the insurer. You can choose the amount of voluntary excess but you’ll agree to this with your insurer when you first take out your policy.
What happens if I can’t afford my car insurance excess?
If you can’t afford your excess, your claim is unlikely to go ahead. Your insurer might offer you a payment plan to pay off the amount but this would be entirely up to them.
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