Should you get excess insurance?

Excess insurance can cut the cost of claiming on other policies and protect you from expensive hire car charges. But do you need it? Here is how to decide if it is right for you.

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Pros and cons

Pros

    Cons

      *If you buy from a car rental company, or don't compare policies

      What does it cover?

      It covers the cost of:

        Excess insurance can cover compulsory and voluntary excesses on a range of insurance policies.

        You will need to agree an excess limit before you take out cover. The higher your limit, the more you pay for cover.

        Here is more about what excess insurance does and does not cover

        Does an excess policy automatically cover any insurance?

        No, you need to list the insurance you want to cover on your excess policy documents. You can give details to your excess insurance provider over the phone, or by completing a quote online. They may also ask for copies of your policy documents, as proof of your excess.

        Is it worth the cost?

        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 are more expensive.

        Weigh up the price of an excess policy against the cost of paying your excess. If it is cheaper to pay your excess, don't pay out for cover.

        Do you need it?

        Hiring a car

        If you hire a car, excess insurance could save you a lot of money.

        Hire car companies can apply a £1,000 excess while you are renting a vehicle. This means 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.

        Shop around to find the cheapest deal and avoid buying insurance directly from your rental company.

        However, make sure getting cover from a separate excess insurer does not break the terms of your hire agreement.

        Do hire cars come with insurance?

        Yes, but they usually come with a high compulsory excess, e.g. £1,000. This means you may have to pay to repair damage to the hire car that costs less than the excess.

        Other types of insurance

        Excess insurance could save you a lot of money if you have 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.

        What type should you get?

        The three types of excess insurance you can choose from are:

          How to find the right cover

          Shop around by using our comparison to find the right cover at the cheapest price. You should check: