Car insurance excess: the big Cuvva guide

Car insurance excess: the big Cuvva guide

The “excess” on your car insurance is an amount of money you have to pay if you make a claim.

There are two types of excess: compulsory and voluntary.

In this guide:

Compulsory and voluntary excess: what’s the difference?

You’ll often hear insurers talking about two different kinds of excess: compulsory (sometimes called “mandatory”) and voluntary.

What does compulsory excess mean?

Compulsory excess is set by your insurer.

Your compulsory car insurance excess is usually based on lots of different bits of information about you – just like your car insurance premium.

That means you’ll probably have a higher compulsory excess if you:

And, just like your premium, different insurers will charge different excess. 

You can’t change your compulsory excess.

What does voluntary excess mean?

You can choose your own voluntary excess. You don’t have to set one at all. But the higher you set it, the cheaper your car insurance premium will be.

You’ll have to pay your voluntary excess on top of your compulsory excess – the two will be added together.

Although having a higher voluntary excess tends to make your premium cheaper, you need to make sure you choose an amount that you could afford to pay if you had to make a claim.

(We don’t offer voluntary excess on our temporary car insurance. But we will offer it with our pay-monthly car insurance. You can sign up for the waitlist now, and you’ll be the first to know when it’s live.)

What does total excess mean?

When you make a claim, you have to pay compulsory and voluntary excess.

When you add them together, you get your “total excess”.

This is the number that matters. When you make a claim, this is what you’ll have to pay.

So let’s say you have a compulsory excess of £150, and a voluntary excess of £300. That would mean you’d need to pay £450 if you made a claim on your insurance.

(We think “compulsory excess” and “voluntary excess” are pretty unhelpful terms. It’s better to think of it as one big excess, with “compulsory” excess being more like a “minimum excess”. But insurers like to talk about compulsory and voluntary excess, so we thought it was worth explaining them.)

How much voluntary excess should you pay?

Having a higher voluntary excess can make your car insurance premium cheaper. But make sure you pick a voluntary excess you can afford to pay if you do have to make a claim.

So how much voluntary excess should you pay for your car insurance? It depends. If adding a higher voluntary excess only knocks a tiny bit off your car insurance price, the amount you’d have to pay to make a claim might not be worth it.

Your best bet is to get a few different quotes with different amounts of voluntary excess, and see how it affects the price of your car insurance.

When do you pay excess on car insurance?

You only have to pay excess if you claim on your own insurance. And (in theory) you only have to claim on your own insurance when it’s your fault.

If it’s not your fault, you can claim on the other person’s insurance.

Which sounds simple. But things can get a little more complicated. So bear with us.

You don’t have to pay excess for “third-party claims”

You only have to pay excess when you claim on your own insurance. That means if you had a bump (that was your fault), and there was no damage to your car, you wouldn’t have to pay excess for the other driver’s claim. 

Your insurer would pay for the whole thing. Even if the accident was your fault.

How do you pay excess?

You pay car insurance excess when you make a claim for damage to your car on your own insurance. But you don’t have to pay it in a lump sum.

Most of the time, when you make a claim, your insurer will take the excess away from your payout. That means you usually can’t pay for your excess in instalments.

And that means you don’t need to send over a big chunk of money to your insurance company.

So if you were in an accident that was your fault, you’d claim on your own insurance, not the other driver’s. And the excess would work like this:

Let’s say you had to make repairs to your car that cost £2,000, and your excess was £500, your insurance company would pay £1,500 to the garage that did the repairs. And then you’d have to cough up the last £500 directly to the garage.

That means you don’t (usually) have to pay your excess as soon as you make a claim.

When it’s not clear whose fault it is

It gets a little more complicated when it’s not clear straight away whose fault an accident was.

If it isn’t clear, you won’t be able to claim on their insurance. Because while the detective work is being done, the other person’s insurer won’t pay out for you.

This is tricky if you need to make repairs to your car, because you’ll need your insurance to pay out as quickly as possible.

If so, you’ll need to claim on your own insurance. And that means you’ll have to pay excess. The compulsory and voluntary bits.

Getting the money back

If you do claim on your insurance – and pay your excess – you can get the money back if it turns out you weren’t at fault.

Your insurer will get their money back from the other person’s insurer. And sometimes, they’ll get your excess back for you, too. But a lot of the time you have to do this yourself, by getting in touch with the other person’s insurer. (It’s called “Uninsured loss recovery”. It’s a whole other thing. We’ll write about it sometime.)

Check your policy docs

That’s generally how things work when you need to pay your excess, but different insurers will have different ways of approaching things.

Some will waive the excess if it’s clearly not your fault. Some will only charge you if they can’t get it back from the other person’s insurer, and some charge you up front and pay it back once they’ve got the money from the other person’s insurer.

If you get into a scrape that’s your fault (and it happens to the best of us), it might not be clear that it was your fault until all the detective work has been done.

So the other driver might claim on their insurance to cover the cost of their repairs, if they have a comprehensive insurance policy. That means they’ll have to pay their excess.

Once it becomes clear that the incident was your fault, the other driver’s insurance company will speak to your insurance company to cover the cost.

Windscreen, fire and theft claims can have a different excess

Sometimes, your insurer will charge different amounts of excess for different kinds of claim. If you need to make a claim for damage to your windscreen, for example, the excess might be lower.

Most insurers charge the same excess for fire and theft claims. But some don’t charge excess at all for those kinds of claims. (Check your policy docs.)

And sometimes the compulsory excess will be higher for certain kinds of claims. 

As ever, it depends on your insurer. Check your policy documents to see exactly what you’ll need to pay when you make a claim.

When should you claim?

The point of an excess is to stop people making claims for tiny amounts of damage. So you need to think about whether it would be cheaper to repair it yourself.

For example: in most cases, car insurance covers scratches and dents. Especially if your car insurance is comprehensive. But the amount you’d have to pay in excess usually means it’s cheaper to fix those smaller bits of damage yourself, rather than making a claim on your insurance.

That’s assuming it’s your fault. If it’s not, and you want to claim on the other person’s insurance, you’ll usually still have to make a claim on your own insurance and then get the money back from the other person’s insurer later.

Even if you don’t make a claim, you should still tell your insurer when you get in a scrape. Keeping that stuff secret could mean your car insurance gets cancelled or voided.

What happens if you can’t pay your car insurance excess?

Your insurer usually takes your excess away from the pay out. So you don’t need to afford your excess exactly – you just need to be able to afford whatever’s leftover for your repairs.

So, if you claimed £5,000, and you had an excess of £500, the insurer would pay out £4,500. 

If you needed that £5,000 to pay for your repairs at a garage, you’d be left £500 short, and you’d need to find a way to cover that bill yourself.

What’s excess insurance?

And just to make things a little more confusing, “excess insurance” – or “excess cover” is a slightly different thing altogether.

Excess insurance is a policy that covers your excess if you have to make a claim. So it’s like an insurance policy that will pay off the excess on your car insurance policy. Like the insurance equivalent of those Russian nesting dolls.

It’s a completely separate insurance policy to your main one.

You usually just get excess insurance when you rent a hire car. It’s not so much of a thing with standard car insurance policies.