What Is Excess In Car Insurance
What Is Excess In Car Insurance?
What Is Excess?
Excess is the amount of money you pay out of your own pocket when making a claim on your car insurance policy. It is also known as the 'deductible' or 'excess payment'. Your car insurance policy will include a 'standard excess' which is the amount you need to pay if you make a claim. This is usually a fixed amount which could range from a few hundred dollars to several thousand dollars. Some insurance policies may also include an 'excess waiver' which means that you don't have to pay any excess if you make a claim.
Why Is Excess Important?
Excess is important because it helps to keep your car insurance premiums low. As with any type of insurance, the higher the risk you pose to the insurer, the higher the premium you will have to pay. By agreeing to pay an excess when making a claim, you are essentially agreeing to take on some of the risk yourself, which reduces the amount of risk the insurer has to cover. This means that they can charge you lower premiums.
How Does Excess Work?
When you make a claim on your car insurance policy, you will have to pay an excess. The amount of the excess will depend on the type of policy you have and the type of claim you are making. For example, if you have a comprehensive policy, you may have to pay a higher excess than if you have a third party only policy. The exact amount of the excess will be stated in your policy documents.
What Happens If I Don’t Pay My Excess?
If you don't pay your excess then your car insurance claim will not be paid. It is important to remember that the excess is a legal requirement and you must pay it in order for your claim to be valid. If you cannot afford to pay the excess, then you may be able to apply for an excess waiver, which allows you to make a claim without having to pay the excess. However, this is not available with all policies and you may be charged an additional fee for this.
Can I Change My Excess?
Yes, you can usually change your excess as long as you are willing to pay a higher premium. The higher the excess you choose, the lower your premium will be. However, it is important to make sure that you choose an amount that you can comfortably afford in the event that you have to make a claim.
Conclusion
Excess is an important part of car insurance and it is important to understand how it works. By agreeing to pay an excess, you are taking on some of the risk yourself, which helps to keep your premiums low. You can usually choose the amount of excess you want to pay but it is important to make sure that it is affordable in the event that you need to make a claim.
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