An excess is a top up to a premium the insured is to pay after a loss has occurred. This amount is required when you make a claim. You agree to an excess payment when you have purchased a policy.
The excess comes in two parts that is, the compulsory and the voluntary excess. The compulsory is the mandatory amount to be contributed by the insured, it was stipulated by the insurer. While on the other hand, the client might think of topping up the mandatory amount, hence there is the voluntary amount to top up the excess.
At the end of the day, we will have something like this, your claim is worth R 14 400, the mandatory excess is R5 400 the remaining R9 000 is to be covered by the insurer in South Africa.
Why include an excess to a claim?
South African car insurance clients would ask this question, Why excess in an insurance? This is because the insurance company wouldn’t want you to make claims of simple car dents and scratches that occur regularly. Not because they cannot manage the dents and scratches but the insurance premium will come with ridiculous expensive amounts.
So, if you are to pay the first amount in the claim, it will prevent drivers from making claims to small damages. However, the mandatory excess depends on the age and value of the car. Ist much expensive if you are a younger diver and a high valued car also cost more.
What are the different types of excess?
According to this excess, you are to pay the money especially if it’s an at-fault claim. The excess can be applied by itself or you can include another excess from the ones provided by the insurer.
The age excess is applied if a younger driver below the age of 25 purchases an insurance policy. The excess is much more expensive for young clients than older drivers.
There is an excess known as the unlisted excess, in this situations, a young person mainly below the age of 25 is driving the car when the claim is made, is not listed on the policy.
Same applies to the inexperienced driver excess, the excess is paid out when a younger driver who holds a license for 2 years or less is the driver when a claim is made.
There is an additional payment a client pays if the car was being driven by a person not listed on the policy. This excess is called the undeclared or driver’s excess.
A voluntarily excess can be paid by the insured. This is an amount to top up the mandatory excess. Perhaps the client is negotiating for a lower upcoming premium.
Glass / Windscreen Excess
The windscreen damages is a common experience during accidents, vandalism or a fire break out. The Glass or windscreen excess is an additional payment. It costs more in every month’s premium but the exciting part is that you can opt for a reduction in the windscreen or a free windscreen repair.
The Final words
Car insurance is fixed in such a way that will leave you in satisfactory. It is advised for all client of all ages to first read and understand the T&Cs before purchasing a policy. You would want any surprises when you make a claim.