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Home insurance excess explained: compulsory vs. voluntary

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Unsure what the difference is between compulsory and voluntary excess? Here’s all you need to know about policy excess.

Money and a house

What is home insurance excess?

In a nutshell, your excess is a fixed amount that you have to pay out if you make a claim on your insurance.

Your insurer makes a deduction from the total, and does not pay out the full amount.

So for example, if you have an excess of £100 and you make a claim for stolen goods worth £400, your insurer will keep the first £100 and give you £300.

What’s the difference between compulsory and voluntary excess?

There are different types of excess – a compulsory excess and a voluntary excess.

The compulsory excess, as the name suggests, is applied to every policy claim and it gets decided by your insurer.

The prices of this will vary but can be as low as £50. The voluntary excess on the other hand can be chosen by you.

You can pay as little as zero, and this will be on top of the compulsory excess.

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Making a claim

On certain types of claims, different excesses may apply: for example if you have accidental damage cover as part of your contents policy, the compulsory excess may be higher.

On buildings cover, the excess for subsidence claims is likely to be substantially higher – around £1,000 is typical – given the fact such claims are normally for very large sums.

You should check the policy before signing up to make sure you’re happy with the excesses that apply.

Take a look at our guide to making a claim if you need extra information.

Should I increase my voluntary excess?

Generally, insurers tend to reduce the size of your premiums if you opt for a higher voluntary excess, as this will cut the amount of money they are liable to pay out.

How else can I reduce the cost of my insurance?

If you decide not to have higher excess when taking out a policy, there are other ways you could lower the cost of your home insurance.

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