Excess Insurance Explained

If you are new to the subject of excess insurance, some of the following points might help you to see just how potentially useful it might prove to be.

In many forms of conventional insurance, including things such as motor, household, travel and pet cover, you may find that your policy will contain what is called excess.

That is usually a specified amount of money that your insurance policy provider will expect you to pay as your contribution to the cost of any successful claims.

To give a highly simplified example, you may have a motor insurance policy with an excess of £750. If at some time in the future you make a successful claim for accident damage on your car of £1000, your final settlement fee from your insurance provider is likely to be only £250. That’s because they will have deducted the excess of £750 from your approved claim of £1000.

While it is true that the excess reduces the amount that your insurance company will have to pay out, it actually exists in order for them to be able to keep their premiums lower for all of their policyholders – including you.

Whatever you may objectively see as being the overall benefits to the entire marketplace as a result of the use of excess, in a given claim situation you might not be exactly pleased to have to pay it. The good news is that you can do something about it - and it’s called excess insurance and is offered by ourselves at Bettersafe.

The way it works is very simple. You simply take out a policy and in the event that you are subsequently forced to pay the excess on one of your main policies, your separate excess cover insurance will reimburse you for the amount concerned (up to pre-agreed limits).

Given the sums that are occasionally involved in the specified excess on policy, this type of additional cover might give you a significant degree of additional peace of mind.

Another benefit of excess insurance is that it allows you to potentially enjoy discounted insurance premiums, as the higher the voluntary excess you opt to pay, the lower your premiums are likely to be.

Of course, any form of insurance cover will come with its own set of terms and conditions.  You should read these to be sure that you are happy with them.

In the case of an excess cover policy, the most significant thing to keep in mind is that it can only reimburse you in situations where your original claim on your master policy was both successful and for an amount higher than the policy’s excess. Clearly, an excess cover insurance policy cannot reimburse you in situations where you have not actually had any excess deducted from your settlement figure or where your claim had been refused by your master policy’s provider in the first instance.

Insurance excess is one of those things that might never seem to be a particularly significant issue – right up until the very moment that you see it deducted from the settlement figure you have received following a claim.

That’s why it might make sense to find out more about such cover now.  It will be too late to do so once you were actually in the process of making a claim on your master policy.