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Car Insurance Excess Can Be Confusing: Here’s What You Need To Know

Car insurance can be confusing at the best of times. But car insurance excess is the automotive equivalent of the off-side rule; a lot of people just can’t wrap their heads around it. Here’s what you need to know…

Beating The Jargon

If you don’t understand car insurance excess, don’t feel bad; you’re not alone. In fact, new research suggests it’s the most misunderstood aspect of car insurance. According to research conducted by GoCompare, ‘voluntary’ and ‘compulsory’ excess terminology is the least likely to be understood. In addition, the website discovered that only 30% of drivers would be able to pay for excess in the event of an insurance claim. More worryingly, only 35% of them check excess policies when taking out cover.

In simple terms, ‘excess’ refers to the money you’ll have to pay if you make a claim via your car insurance. It’s applied to the likes of write-offs, thefts and at-fault accidents. There are two types of excess, ‘voluntary’ and ‘compulsory.’ Together, they make up ‘total excess.’ That total can reach eye-watering figures if you choose an inappropriate policy, which it’s why it’s so important to check.

Voluntary Excess 

Voluntary excess is determined by the policyholder i.e. you. It’s the amount you’re prepared to pay in the event of a crash or collision. Opting to pay a higher excess (usually) entails the benefit of a reduced premium. So, if you can’t see yourself experiencing a bump, it can be a sensible course of action; just remember that it could hurt you if you do need to make a claim.

Compulsory Excess 

Compulsory excess is the amount you need to pay. It’s based on a number of factors including your age, the model of your car and how long you’ve been driving. Your claim will only be processed by your insurer once the excess has been paid; whether you’re at fault or not. Depending on your insurer and your policy, the excess might be paid back to you if the other driver admits fault and notifies their own insurer.

Check Your Policy

Leo Griffin, CEO at GoCompare, has suggested that people are often shocked at the cost of excess. He said, “policy excesses are a grey area for many people and, as a result, they can provide a nasty shock during a claim – a time when there is already enough stress.” He advised drivers to thoroughly check their policies and to deduce the full cost, including the premium and excess. Doing so means avoiding potentially nasty surprises in the unfortunate event of having to make a claim.

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The Autoserve Club can save you time, money and stress. Club Members can receive discounts on servicing and new tyres and will gain access to our professional 24/7 helpline. To learn more, contact our friendly Service Advisers on 0121 521 3500 today.

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