WHAT IS CAR INSURANCE EXCESS | INSURANCE EXCESS EXPLAINED
WHAT IS CAR INSURANCE EXCESS?
How much extra will you pay? is a question the company representative will ask you while choosing the insurance package. When a claim is made, the policyholder is required to pay the excess. For instance, the vehicle was in a collision. One thousand AED was spent on repairs. AED 600 could be paid by the insurer. You will be responsible for paying the remaining AED 400, often known as the excess.
Who decides the excess amount is the obvious next question. You must comprehend the two sorts of excess in order to respond to this question.
TYPES OF CAR INSURANCE EXCESS?
There are two types:
Compulsory
The minimal sum that must be paid by the policyholder when making a claim is known as the compulsory excess. The insurance company decides on the sum. Make sure to verify this sum when purchasing a car insurance policy. The required excess is calculated using the driver’s age, profession, kind of vehicle, and other variables.
Voluntary
Voluntary excess is any payment made in addition to the required extra. The mandatory excess, for instance, is AED 300. You want to spend an extra AED 100 when you purchase the policy. The extra money is voluntarily surplus. Keep in mind that you will pay less premium if your excess is bigger overall.
We will address some often asked inquiries about the auto insurance excess in the section that follows.
CAR INSURANCE EXCESS FAQS
Can You Change Compulsory Excess?
The quick response is no. All insurance customers are required to pay this minimum amount, which is set by the insurer. Negotiating with the representative can, however, enable you to obtain a decrease in this sum.
Should You Opt For Voluntary Excess?
As previously stated, choosing a bigger excess will lower your insurance cost. To determine the ideal amount for voluntary excess, there is no formula. Paying a significant voluntary excess can occasionally work against you. To have a thorough knowledge of how voluntary excess functions, think about the example below.
You are involved in a collision while driving. The car has sustained 700 AED in damages overall. The required excess was 400 AED. You decided on a voluntary excess of AED 300 when you purchased the insurance. You now have to pay a total of 700 AED. The insurance company will make no payment. There is no advantage to getting automobile insurance in such a circumstance.
Do You Have To Pay The Compulsory Excess In All Cases?
Certain claims may be submitted without having to pay the required excess. But that depends on the insurance company. As a result, you must speak with your insurance company to obtain the necessary information.