How Excess Cover Insurance Might Help You To Save Money

Here Is A Quick Summarised Overview Of Just How Excess Cover Policies Might Help You To Save Money

The excess on a typical policy is a sum of money you will have to find from your own financial resources, to contribute to the total cost of a successful claim. Some insurance providers call this “the first part” of an insurance claim.

It simply means that if you have a successful claim on your motor, household, travel, pet or other types of policy, the amount that you receive in the settlement may be significantly less than the amount you have notionally successfully claimed.

To take an entirely hypothetical example – you lodge a claim on your household policy for damage repairs costing a total of £1500. If your policy contains a stated excess of £1000, the settlement figure you will receive from your policy provider will typically be £500.

Note that typically your insurance provider won’t process claims where the total value is lower than your stated excess.

Given the substantial sums that are involved, many people consider taking out what is called an excess protection policy.

Bettersafe excess insurance policies will enable you to claim back the amount of money that has been deducted from your successful claim by the provider of your master policy.

However, excess insurance may have added attractions beyond simply reimbursing you for such deductions.

To understand how you need to remember that the excess on a typical policy is a mandatory amount that you might not be able to vary downwards. However, you may be able to voluntarily increase the excess and in return, your insurance provider may offer you some very attractive discounts on your annual insurance premiums.

This then requires a little simple mathematics. If you increase your voluntary excess across one or more of your master policies and then cover that through excess insurance, you may be in a position whereby the cost saved in your insurance premiums significantly exceeds the cost of your excess policy protection. The bottom line means that you will be significantly in the pocket.

You should, of course, make sure that you understand the terms and conditions associated with any sort of insurance policy including those providing excess cover. Note that you cannot claim on your excess policy unless your main claim has been accepted by your primary policy’s provider and the amount being claimed actually exceeds the stated level of excess on your master policy.

Be sure you understand the financial implications associated with increasing your voluntary excess on your policies. Setting them too high may mean it will be practically difficult for you to lodge a claim against a master policy should the amount be lower than the excess. If you could not, your excess insurance cover would not pay out either.

Finally, note that with our lifestyle multi excess protection policy, we offer a combined excess waiver on a number of policies, such as travel, pet, health and household buildings and contents. That might be a particularly cost-attractive solution.