An excess is the amount that you will pay towards your insurance claim.  For example, if you have car insurance and you are involved in an accident that results in a car part having to be replaced or repaired or if the vehicle is written off, you will only pay a portion of the total cost out of your own pocket while your insurance covers the rest.

Having an excess on an insurance policy ensures lower premiums, but is insurance not supposed to protect you from having to pay costs out of your own pocket?  Well technically yes, but to make insurance affordable for all, a compromise has to be made between the insurer and the policyholder.  Insurance is like a safety-net that helps you when an insured incident occurs.  Your cover will be explained in your policy wording subject to certain limitations or exclusions.  You do have the option to select a higher excess in exchange for a lower premium.

Excess structures may differ from policy to policy and the structure applicable to your policy is predetermined when you take out your insurance.   It is important to make sure you are happy with the excesses applicable when you apply for a new policy.  If you are unsure what the excess structure on your policy is, please contact our office.

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