Last updated: 16 October 2020
To get the cheapest policy that offers the right cover for you, get as many different quotes as you can.
Look for insurers who can cover the cost of your excess if you need to claim on your car insurance or hire vehicle policy.
It reimburses the excesses you have to pay on other insurance policies when you claim.
It is often used to run alongside car hire agreements, to cover the high excesses charged by car rental companies.
You still need to pay your insurance company the excess when you make a claim, but you can then recover the cost from your excess policy.
Get the cover you need by using this comparison to check:
Cost: If the cost of cover is more expensive than the cost of paying your excess yourself, you may not need it.
Claims limits: You need to pick your limit before you take out cover, so choose enough to cover your compulsory and voluntary excesses.
Worldwide cover options: If you drive your car abroad, or if you are looking to cover your travel insurance excess, look for a policy that covers you outside the UK.
Types of policy: You have the option of a single policy, which covers one insurance excess, or a lifestyle policy, which covers several. You can get daily cover, for short term car hire; or an annual policy, which can cover several rentals.
Excess insurance can cover insurance policy excesses, like your motor or home cover, and the high excesses charged by hire car companies.
An excess insurance policy can cover compulsory and voluntary excesses on a range of insurance policies.
You will need to agree to an excess limit before you take out cover. The higher your limit, the more you pay for cover.
There are a few common exclusions for excess insurance cover, but it will vary between policies. The main exclusions of excess insurance are:
Excesses that go over your policy limit, e.g. £750
Events that happened before the start of your policy
Claims not covered by your main policy
Excesses that can be claimed from a third party, e.g. if they are at fault
Claims where you have not met the terms of your hire agreement
If you hire a car, excess cover could save you a lot of money.
Hire car companies can apply a £1,000 excess while you are renting a vehicle. This means if you make a claim, you would have to pay for any damage up to the value of £1,000. But if you have excess insurance, it would cover this cost for you.
Make sure getting cover from a separate excess insurance provider does not break the terms of your hire agreement.
Hire cars will usually come with an insurance policy, but it will likely include a high compulsory excess, such as £1,000. This means it will cost you at least £1,000 to make a claim.
Excess insurance cover could save you a lot of money on any policy that features a high compulsory excess.
For example, you may have to pay a high theft excess on your motor insurance, or for subsidence claims on your home policy.
If you are a new or young driver, you may also face higher compulsory excesses because you are more likely to make a claim.
The three types of excess insurance you can choose from are:
Car hire: This covers you when you rent out a vehicle where high excesses apply. You can take out cover on a daily or annual basis, depending on how long you are hiring the vehicle for.
Single policy: This covers the excess on one insurance policy, like your car or home insurance. Excess cover like this is best if you have insurance with a high excess to save on your premium.
Lifestyle policy: This acts as excess cover on a range of insurance policies, like your car, home and travel insurance. This is usually the cheapest way to cover all your policies, but there will likely be a cap on how much you can claim for.
It depends on how high your excess is and the cost of an excess insurance policy. For example, some can cost as little as £2 a month, but others will be more expensive.
You need to balance the price of an excess policy against the cost of paying your excess out-of-pocket. If it is cheaper to pay your excess, don't buy additional cover.
It varies between insurers, but some excess policies can cost as little as £2 a month.
You should consider the cost of the excess on the policy or policies you want to cover before taking out an excess insurance policy, to decide if it is worth the cost to you.
It is not compulsory, but most hire car firms will try to sell you cover. It pays to shop around or get help from a broker.
It depends on the cost of your excess. If your excess is higher than the cost of an excess insurance policy, you could save money if you need to claim.
Some insurers limit how many times you can claim, or put an overall cap on the amount you can claim for. Check the terms of the policy for full details.
No, it does not cost to claim on an excess insurance policy.
Find excess cover for your car or hire vehicle policy today.