What Does It Mean to Have Excess on Your Car Insurance?

When it comes time to choose an insurance rate based on the quotations you’ve received, be sure to compare the excess amounts offered by each company! When it comes to auto insurance, an excess is an expense that you are responsible for paying to the insurer. In the event that you are involved in a car accident, your insurance policy will only pay the amount that it is configured to cover with the excess. In order to cover the expenses related to damage and repair work, you will additionally be required to pay a surplus fee in addition to your premium.This article will explain why there is such a thing as excess and what it actually is, so don’t stress if you’re confused about either of those things.

What Exactly is an Excess?

The phrase “pay monthly and you are covered for all accident expenses” does not accurately describe how an auto insurance premium works. When determining the cost of your monthly vehicle insurance premium, the deductible and the excess both need to be taken into consideration.

The insurance company receives the excess payment directly from the policyholder. For instance, if your excess is R500 and the cost of repairs is R10,000, your insurance company will cover for R9,500 of the total, and you’ll be responsible for paying the R500 excess payment.

The function of excess is to provide insurers with what amounts to a form of ‘insurance,’ in the sense that it helps safeguard them from false allegations. It also aids in discouraging customers from making an excessive number of insignificant insurance claims. It is helpful in promoting liability and sensibility when it comes to insurance claims because you are required to pay the excess amount yourself during the procedure of filing a claim.

How the Excess on Your Car Insurance Works

Let’s look at a scenario to enhance the way that the process of auto insurance works. Consider the following scenario: you have an insurance plan with an R25,000 deductible, but you are involved in a collision that causes a loss of R100,000 in total. Your insurance provider will keep the first R25,000 of the settlement and offer you the leftover R75,000 after their deductions.

Consider a different hypothetical situation in which you’re involved in a collision that results in damages valued at R6,000. If you possess an insurance excess of R500, your insurer will contribute R5500 to the garage to repair your car, and you will be responsible for paying the R500 excess yourself.

When You Recover Your Excess

So, is it possible to get a reimbursement on the amount that you overpaid? Yes, you can. Having said that, there are a few prerequisites that need to be met. Here are two possible approaches to taking care of this issue:

Letting Go of the Surplus

The majority of service providers will, at the customer’s request, not charge an excess fee. The customer will now provide evidence to prove that they weren’t to blame for the accident, as well as identify those personally liable and provide contact information for them to the service provider. The customer is still responsible for a basic excess premium in the event that a parked vehicle sustains damage as a consequence of a flood or fire.

Covering Yourself Against Your Excess

You have the option of purchasing an additional insurance policy known as excess coverage to protect you in the event that you file a claim. To get the most out of this situation, you should consider the price of the insurance plan as well as the expense of paying a higher voluntary excess. Take, for instance, the scenario in which you purchase an excess insurance policy with a value of R600 in order to cover an excess amount of R12,000.

You need to determine whether the rise in the excess amount saved will save you more money overall than the R600 that the excess insurance policy will cost you.Through their compliance department, some insurance companies will assist you in recovering a portion of your excess at no additional cost. You must, however, ensure that this process is immediately put into action by the party responsible in order to guarantee that you will receive a full refund once the procedure has been successfully completed.

Different Kinds of Excess

In most cases, the excess is broken down into two distinct groups: mandatory excess and voluntary excess.Your policy will be subject to the mandatory excess, which is a predetermined dollar amount that is set by your insurer. An excess payment is required of everyone, but the rates vary according to your age, the type of car you drive, and various other aspects of your insurance policy.When you consent to pay a higher amount than the minimum required by your insurance policy and are prepared to do so, this is known as a voluntary excess, and it entitles you to a reduced monthly premium.

The portion of the claim or the type of the claim may be used by some insurance service providers as a basis for determining the excess that must be paid. whereas other service providers may be able to offer a predetermined excess amount. When looking at different quotes for car insurance in South Africa, you should keep this in mind.

The Standard Excess

A fee that is agreed upon by both the insurer and the insured to be cooperatively contributed to in the event of a claim being made; this fee serves as the basic excess and is appropriate to all claims. Use it in conjunction with another excess, or use it on its own.


The following are examples of types of excess that may apply to car owners under the age of 25:

  • Drivers Lacking Experience
  • This rule applies to motorists who are older than 25 years of age but have less than two years of experience of driving.
  • Unlisted Driver Surplus Charges
  • This pertains to drivers who are under 25 years old and are not protected by this policy.

Extra Baggage on Top of That

Based on the terms of the contract you have with your insurance company, you may be required to pay supplemental excesses on top of the basic excess in certain circumstances. These extra excesses come into play in certain events. A good illustration of an additional excess would be:

  • The driver who caused the accident has had their car licence for fewer than two years.

When Will You Pay Excess?

Whenever you file a claim with your insurance company, you will be required to pay the excess first. Take, for instance:

  • If you’re victim of an accident, you are responsible for paying the excess, regardless of who was at fault for the accident.
  • In the event that your car is stolen,
  • In the event that your car sustains damage while you are driving on hazardous roads
  • When you file a claim with your insurance company, you are responsible for paying the excess. Therefore, it is preferable to pay for the damages to your car out of pocket if the total amount is less than the amount of your deductible.
  • When you make a claim on your insurance policy, in addition to the insurance premium, you will also be required to pay any applicable excess amounts.
  • The surplus amount assists in preventing individuals from making an excessive number of insignificant statements or false allegations.
  • You have the option of selecting one of two different types of excess, and the decision you make will play a role in establishing the amount of your monthly premium.

To Summarize the Various Forms of Excess

  • When filing a claim, you are required to pay an amount known as the mandatory excess. This sum is set by the insurance company.
  • When you opt to pay a greater amount than the mandatory excess in exchange for a lower premium, this is known as voluntary excess.
  • We sincerely hope that this provided you with a better understanding of insurance premiums as well as excess. It is time to get your premium if you are at the point where you are feeling more confident in your understanding.