There are two reasons you might consider taking out excess protection car insurance. The first is to protect yourself from any unaffordable bills if you do need to claim your car insurance. The second is to save yourself money on your car insurance premium. Want to know how it works? Find out more with our quick guide.

Firstly, what is an excess?

The excess is the amount you have to pay if you claim your insurance. In most cases, you don’t make a payment to your insurance company. Instead, the excess amount is deducted from the final settlement that the insurance company agrees to pay.

For example, your car insurance has an excess of £400. You have an accident, and the repair bill comes to £900. Your car insurance provider will pay out £500, which is the £900 bill less the £400 excess.

Many insurance policies include an excess, including home insurance and car insurance.

Why is my car insurance excess so high?

Insurance providers set an excess to try to put customers off claiming on the insurance policy for smaller amounts. They do it because sorting out small claims can cost them a lot of money in administrative time and effort.

The amount of excess set by your insurance company is compulsory with no option to reduce it. This excess varies depending on your insurance company and circumstances. It’s typically somewhere between £50-£300.

When you get a quote for car insurance, this will typically also include a voluntary excess in addition to the compulsory excess. This is an extra excess you can pay, and you can control the level. Generally, the higher the voluntary excess, the lower your premium will be. Voluntary excess can normally be anywhere between £0-£750.

Remember, you’ll need to add together the compulsory and voluntary excess figures to see how much you will have to pay yourself if you make a claim. For example, a compulsory excess of £150 and a voluntary excess of £250 means you’ll have to pay out the first £400 for any claim you make.

Beware of high voluntary excesses on cheap car insurance from comparison sites

Insurance companies try to get your attention on price comparison websites by offering the lowest premiums they can. This is often achieved by setting the voluntary excess high. Watch that you don’t get caught out by carefully checking both the compulsory and voluntary excess before you buy. Even if you specify a lower voluntary excess, you may still be offered premiums with much higher excess amounts.

What is the maximum car insurance excess?

The maximum voluntary excess you can set varies between providers but usually is somewhere between £250-£750.

Next, how does excess protection car insurance work?

If you hold an excess protection car insurance policy, this will cover the costs of your excess on your regular car insurance.

For example:

You have an excess of £500 on your car insurance policy. You have an accident, and the repair bill comes to £1,500. Your car insurance policy will pay out £1,000 with the first £500 being your responsibility. But your excess protection policy will reimburse you that £500. That means you have peace of mind that there won’t be any unexpected big bills to cover.

Do I need excess protection car insurance?

Insurance is all about protecting you from financial risk. To find out whether you need excess protection car insurance, ask yourself:

• Can I afford to pay the excess on my car insurance if I need to make a claim? If you can’t easily get hold of the money, you could be left in a tricky situation unable to pay the repair bill and without your car.
• Am I happy to take the risk of needing to pay out my excess? Excess protection will reassure you that there will be no unexpected big bill.

What about if an uninsured driver hits me?

Normally, if you have an accident and you’re not at fault, the other party’s car insurance takes care of the excess. But what if an uninsured driver hits you? In this case, you have to claim for the repair on your insurance and may have to pay the excess. Check your car insurance policy as some insurance companies automatically offer to protect your excess. If not, excess protection car insurance could be a valuable extra layer of financial protection.

How can excess protection car insurance save me money?

Savvy shoppers are increasingly turning to excess protection car insurance and discovering that two layers of car insurance can be cheaper than one. Yes, you read it right. Taking out two separate layers for your car insurance could save you money. That’s because increasing your excess is a handy trick that can help to bring down your car insurance premium. But rather than leaving yourself exposed to hefty excesses if you do need to make a claim, you can also take out excess protection car insurance.

You could save ££s as long as the amount you pay for your excess protection insurance is lower than the amount you save off your regular car insurance by increasing the voluntary excess.

Are there any downsides?

Bear in mind that you’ll need to make two separate insurance claims if something does happen. You’ll make one claim on your regular car insurance, where you’ll have to pay the excess. Then you’ll need to complete an additional claim on your excess protection policy to have the cost of the excess reimbursed.

Finally, find out more

If you’re interested in excess protection car insurance, get in touch with our friendly team at Easy2Insure. Whether you want to get smart with cheaper car insurance or want to protect yourself from unexpected bills, we can help. We’ll shop around on your behalf to source the best value excess protection. And that can give you peace of mind or even save you money on your car insurance annual premium. Call us on 0800 917 9522 or get a free quote.

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.