People know that applying for car insurance is becoming a necessity more than a luxury, especially since it covers your repair or medical needs in case you run into an unfortunate accident. However, applying for insurance isn’t as straightforward as it seems since it is often accompanied by an “excess” cost.
These excess costs serve as a protection for the insurance provider as it requires you to take a percentage of the risk by paying a certain amount if you decide to move forward with your claims. Think of it as a way to ensure that people won’t abuse their insurance, or mitigate misconceptions that insurance can guarantee financial protection at every turn.
What is Excess?
As mentioned above, excess serves as a payment required by your insurance company. Imagine making a claim of £400, but your insurance will likely pay £300 only while you handle the excess of £100. There are two types to consider:
- Compulsory Excess – as the moniker suggests, this is often established by your insurer and largely depends on your age or driving experience. In addition to your skills, the type of car you are driving will also have a factor in the amount of excess you have to pay;
- Voluntary Excess – this is set when you apply for an insurance policy, which means the excess you have to pay can vary depending on your plan. It’s usually used as a reward as it lowers the price of your plan – premium or not – the higher the cost of your voluntary excess.
Unfortunately, you are required to pay the excess, even if you are not to blame for the loss, damage, or accident. That’s where insurance excess comes into play, which is a coveted solution for guilt-free parties.
What is Excess Insurance?
Acting as a complementary plan that supports your existing insurance policy, excess insurance covers for the excess you have to pay in case of an accident. The amount varies depending on the agreed terms between you and your insurer, though it’s up to you to choose the upper limit. There are two main types of excess insurance:
- Single Policy – this only covers the cost of excess for one insurance policy, such as your car insurance, for instance;
- Lifestyle Policy – if you want to cover the excess for multiple policies, this choice can protect you from paying for the excess on your car, travel, home, pet, and other forms of insurance;
The Bottom Line: Choosing Excess Insurance For Your Car Or Car Hire
You can benefit the most if you have excess insurance for your car or car hire, especially since both policies tend to charge the highest in case you run into trouble. Car hire companies can ask for as high as £500 to £1,000 if excess, so having excess insurance can protect you from paying out of your pocket by covering most of the fee.
If you’re looking for a reliable excess insurance provider in the UK, we’re the best to call. We can tailor your insurance policy and offer excess protection for your vehicles, motorbikes, multi-car, and more. Get in touch with us to see how we can help.