What is a policy excess?
A policy excess is an amount you agree to pay towards a claim. If you are involved in an accident, and you submit a claim for €4,000 and the excess amount on the policy is €200. The insurance company will pay €3,800 towards the claim, and you will contribute the remaining excess amount of €200.
So basically it is the amount you pay towards the claim, and the insurance company will pay the balance up to a limit outlined in your policy document. The excess amount for car insurance in Ireland generally ranges from €250 to €1,000.
The higher the excess you choose, the lower your insurance premium. The lower the excess you choose, the higher your insurance premium. There are two types, compulsory and voluntary excess.
What is a compulsory excess?
Compulsory excess is the amount that is set by the insurer; this amount will depend on the age, make, model and condition of your vehicle.
What is a voluntary excess?
Voluntary excess is the amount that you can choose to be added to your car insurance policy. It is an additional amount of excess you agree to pay on top of the compulsory excess in the event of an insurance claim.
When do I have to pay the excess?
You will pay the excess on your policy in the event of a claim. This claim may be due to theft of your vehicle, fire damage to your car or if your car is a write-off. Generally, your excess will be taken from the total cost of the repairs to your vehicle.
However, if the cost of repairing your car is less than the policy excess amount, you will not be able to claim on your car insurance policy.