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Car Insurance Excess Protection – is it worth it?

The cost of car insurance continues to spiral upwards. Earlier this year, experts warned premiums could increase by a staggering £1000 thanks to government changes to personal injury payouts. If you’re trying to keep your insurance costs down, opting to pay an additional voluntary excess can help lower premiums. It’s very tempting to opt for a higher excess, especially if you’re confident you’re a safe driver. But no matter how careful a driver you are, accidents still happen – and often through no fault of your own. If that happens, can you afford to pay the large excess that seemed such a good idea when you took your insurance out?

Luckily, there is a clever way to get the best of both worlds. You opt for a high excess to bring down the costs of your annual insurance premium and you take out a separate car insurance excess protection policy to cover you for this cost if an accident does happen.

Should I take out car insurance excess protection?

When you take out car insurance excess protection you have peace of mind that you won’t need to find a lump sum of cash to pay for the excess if you make a claim. You can take advantage of cheaper car insurance premiums, but if you do have an accident, you won’t be faced with any big bills.

To decide if you should take out car insurance excess protection you need to consider if you could easily afford to pay the voluntary excess on your car insurance. If you could, you may decide that you’d rather take the risk than pay for excess protection. But if you can’t, or you just prefer to eliminate risk from your finances, then car insurance excess cover could be a good choice for you.

What about if I have an accident that isn’t my fault?

If you have an accident that isn’t your fault, and that is agreed by the other party’s insurance company, you’ll be able to claim back the cost of your excess from them. But if the person who causes the accident is one of the estimated one million uninsured drivers on the UK roads, you’ll be stuck paying the excess yourself.

How does car insurance excess protection work?

As an example, if you opt for a voluntary £500 excess on your car insurance you will have to pay that sum to your insurer, as well as the compulsory excess if you make any claim for damage, fire or theft. With car insurance excess protection, you’ll still need to pay your excesses when you make a claim but your insurer will pay out £500 to you to cover that cost.

Reduce your liability to £0

Remember that your car insurance provider will also have a compulsory excess. This can differ depending on your insurer but is typically £50-£150. If you want to cover this cost as well, set your excess protection at the amount of your compulsory excess and your voluntary excess added together.

Save more in the long run

Whilst taking out car insurance excess protection does involve making two claims rather than one, the cost savings you’ll make can far outweigh any slight inconvenience.

What is lifestyle excess insurance?

As well as taking out excess protection for your car insurance, you can also opt for lifestyle excess insurance. This annual policy would cover the excess costs on all the insurance policies you hold, such as car, home, pet and travel insurance. This can be a good option if you want reassurance that you’re financially protected from any potential excess costs but remember that it will only pay to a capped amount. If you take out excess protection insurance for £500 and make more than one claim in a year that comes to more than this amount, you’ll only get the £500 you’re covered for.

Hire car insurance excess protection

Excess protection is not just a good option for your own car. It can give you real peace of mind when you hire a car on holiday or on business.

When you hire a car, it is insured by the car hire company and you’ll pay an agreed excess fee if any damage occurs. This can range from around £300 to £1500 depending on the car or hire company.

Most car hire companies offer you the option of taking out excess protection insurance when you hire a car from them. But purchasing it from the car hire company can sometimes be more costly than if you organise it yourself. If you don’t take out excess protection with the hire car company, they may ask for a deposit to be secured against your credit card.

Is there anything else I need to think about?

Always be aware of the small print. Thoroughly check through the wording of your policy or discuss it with your broker so you can be confident that you have the level of cover you need.

Get a good price on car insurance excess protection

Like all insurance products, it pays to shop around if you want to be sure you’re getting a good price on your car insurance excess protection.

Easy2Insure is an independent insurance broker, so we can search through a wide variety of car insurance excess protection providers to find you the best value deal. We have over 30 years experience in the industry and we have ‘preferred’ broker status with some of the UK’s largest insurance companies, which gives us great negotiating power to secure great prices on your behalf. Call our friendly team for free now on 0800 917 9522 or get in touch for a no-obligation quote.