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The Excess Factor – Car insurance voluntary excess explained

Citroen DS5When money is tight, it’s not surprising that people look for ways to save on their car insurance premiums. One solution that drivers are turning to is opting for higher voluntary excesses.

But it’s important to be aware of exactly what voluntary excess is, and the consequences of raising it. Our handy guide cuts through the jargon and provides the knowledge you need to make an informed decision about your car insurance.

What is a car insurance policy excess?

In simple terms, the excess on a car insurance policy is a fixed contribution that you, as the policy holder, will have to stump up in the event of a claim. So if you have an excess of £500, and you’re making a £750 claim, the insurance provider will only pay out £250 as the first £500 will come out of your pocket.

If the claim is deemed not to be your fault (for example, if you’re involved in a car accident that is solely the responsibility of the other driver), car your insurance provider can waive the excess, meaning that the claim will be paid in full. However, you need to check the terms of your policy carefully as this is not always the case.

Compulsory or voluntary excess?

A compulsory excess is an amount that your car insurance company has decided that you will have to pay towards each claim. In car insurance, the figure will vary according to the age of the driver, the type of car, and even the kind of claim. For instance young drivers, who are considered to be high-risk customers, often have to pay much higher compulsory excesses than their older, more experienced counterparts.

In contrast, a voluntary excess is something that the customer themselves chooses to pay in the event of a claim. In return for opting for a higher excess, the insurance provider will usually lower the premium paid. Bear in mind though that the voluntary excess will always be paid in addition to any compulsory excess. So if you have a compulsory excess of £400, and then choose a voluntary excess of £300, you will have to pay a combined sum of £700 towards any claim you might make.

Tempted by excess?

If you’re a careful driver who rarely breaks the speed limit and never has even a sniff of alcohol before getting in the car, raising your voluntary excess might seem to be the logical option. However, before doing so, you need to carefully consider whether you can really afford to pay the excess in the event of an accident.

It’s easy to agree to a high figure when arranging your car insurance, but less simple to actually find the cash when your car needs fixing after a collision.

Celebs who shouldn’t go for high voluntary excess

As we’ve mentioned, you should never opt for an voluntary excess that’s higher than you’d actually be able to pay. It’s also probably not a good idea if you think you’re likely to make a claim, so it’s a tactic that the following accident-prone celebrities should possibly steer clear of.

  • Celebrity chef Gordon Ramsay’s rental car collided with a farmer’s vehicle as he attempted to herd water buffalo for his F-Word TV show.
  • High heels caused ex-model Brooke Shields to lose control of her vehicle and crash into her own house.
  • Singer George Michael has had a run-ins with a parked car.
  • Troubled pop-singer Britney Spears had three car accidents in the space of a year.
  • Boxer Prince Naseem was jailed for dangerous driving after a particularly nasty head-on collision with another vehicle.

Other ways to save on car insurance

So, if you’ve decided that bumping up your excess isn’t the way to save money on your car insurance premiums, what else can you do? One of the simplest ways of finding cheaper car insurance is by using's comparison service. Just fill in one simple form, and we’ll go to a range of insurance providers to find the best price for you.

But it’s not all about price. Our results also show policy details, including the excess levels, which means that you can choose the most suitable car insurance for you. If you’re uncertain about any aspect of car insurance, our car insurance buyer’s guide will assist you in choosing the most appropriate cover.

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