What is a policy excess?

A policy excess is the amount you have to pay towards the cost of your claim. There are different excesses that may apply.

• Compulsory/standard excess¹ – fixed by your insurer
• Voluntary excess² – chosen by you to reduce premium
  
  

[1] Standard or compulsory excess

This is a set amount of money that you pay towards the cost of a claim before your insurer pays the rest.

• It is mandatory (you don’t choose it yourself — your insurer sets it).
• It applies whenever you make a claim on your policy.
• It’s separate from any voluntary excess (which you can choose to help reduce premiums).
  
  

Example of standard excess:

• Claim cost: £1,000
• Standard (compulsory) excess: £250

• You pay £250
• Insurer pays £750
  
  

[2] Voluntary excess:

This is an optional amount of money you choose to pay towards an insurance claim, in exchange for a lower premium and is in addition to the compulsory excess set by your insurer.

When making a claim, the total amount you pay is the combined amount of compulsory and voluntary excess, with your insurer covering the remaining cost.

Example of voluntary excess:

• Claim cost = £1,500
• Compulsory excess = £300
• Voluntary excess = £250

• Total excess = £550
• You pay £550
• Insurer pays £950

Details of all your policy excesses can be found on your Insurance Schedule/Statement of Fact in your online account.

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