The amount you agree to pay towards any claim you make on your car insurance is known as an excess. And there's more than one type… find out the difference between voluntary excess and compulsory excess.
What’s a voluntary excess?
As the name suggests, voluntary excess on car insurance is different to the compulsory excess in that it’s dictated by the policyholder. Remember, this is the amount you’ll pay on top of the compulsory excess set by your insurer.
This means if you have a compulsory excess of £500 and you agree to a voluntary excess of £250, you’ll pay a total of £750 up front for your car to be repaired after an incident.
Because you’re agreeing to cover more of the cost of any claim, it’s likely that a higher voluntary excess will bring down the cost of your car insurance policy premium, as it lowers the financial risk to the insurer.
Before you take out a policy, you need to be sure you can afford to pay your total excess – both voluntary and compulsory – if you’re involved in an incident and need to claim.
