Compulsory and Voluntary Excess Explained
If you’ve ever compared car insurance online you’ll no doubt have noticed a question about voluntary excess.
You’ll also probably have noticed that increasing your voluntary excess makes the overall cost of your insurance drop too.
It’s an important part of your car insurance and one you should be aware of.
What is insurance excess?
Your car insurance excess is the amount of money you need to pay when you make a claim on your insurance.
It’s split into two parts, Compulsory and Voluntary, and both need to be paid when making a claim on your policy.
What is compulsory excess?
Compulsory excess, as the name suggests, is a fixed amount you have to pay when you make a claim on your insurance.
It’s determined by your insurer and you have no say in changing the amount.
Your insurer uses your driving history and profile to calculate your compulsory excess, in much the same way they do to calculate the cost of your premium.
What is voluntary excess?
Voluntary excess still needs to be paid on top of your compulsory excess in the event of a claim, however you have some say in how much it will cost you.
When you’re getting a car insurance quote you can change the amount you are willing to pay as part of your voluntary excess.
The more you’re willing to pay for your voluntary excess, the cheaper your premium will usually be.
As a result, it’s tempting to push your voluntary excess as high as you can however you must be able to pay your voluntary excess and your compulsory excess if you want to make a claim.
Make sure you can afford to pay both in the event of a claim.
Why does voluntary excess change the cost of car insurance?
When you make a claim your insurer needs to pay for any costs, whether they’re for repairs or personal injury claims.
Your voluntary excess goes someway to covering those costs so the more you’re willing to pay, the less your insurer has to.
Compare car insurance quotes now and see how increasing your voluntary excess can cut the cost of your policy.
But remember: you need to be able to pay both excesses on your insurance in the event of a claim!
Help! I can’t afford to pay my car insurance excess
Some motorists find themselves in the unenviable position of needing to make a claim and being unable to afford their excess.
If you can’t afford your excess, your insurer is unlikely to pay out on your insurance.
Should I get excess insurance?
Excess insurance insures the excess you’ve agreed to pay and in the event of making a claim, your excess insurance will cover the cost.
Excess insurance isn’t cheap however so it’s worth pricing it up to see how expensive it could be in the long run.