Your excess is a one-off amount that you pay each time you make a claim. Let’s say your excess is $500 and a repair job for a dinged-door costs $800. You pay the first $500.
The excess helps keep the cost of handling and meeting insurance claims down and so the premiums everyone pays are cheaper. You choose your excess from a range of options when you first take out your policy. You should also review it each year, when your policy renews.
Standard excesses apply irrespective of whether you, someone else or mother nature caused the damage. So, it’s a good idea to check your excess amount(s) so there’s no surprise if you need to claim.
Other excesses
A voluntary excess is where you can choose a higher excess for a lower premium. Most home and contents policies allow for this. If you don’t claim often, and are prepared to pay more towards any claim, it’s a great option.
An imposed excess is one that your insurer sets. This usually occurs when there is a higher risk, for example if your vehicle type is popular among thieves, we may impose a higher excess.
If you, or one of the drivers of your car, is under 25, an additional age-related excess will apply if they are involved in an accident while driving the car. This age-related excess is in addition to the basic/standard excess.
A similar condition may apply depending on your licence type. If you hold a learner, restricted or overseas licence, you may have an additional excess applied on top of your basic/standard excess and any applicable age excess. These additional excesses will be noted on your policy schedule.
But I’m not at fault, do I still need to pay an excess?
If you have comprehensive car cover with AMI, State or NZI, you may have Excess Protection cover. This means that if another driver is at fault for damage that is covered by your policy, we may waive or refund your excess if you can prove the other driver was completely at fault, and provide their name, address, and registration number.
In other situations (e.g. someone crashes into your home’s front fence) where we recover the full costs of your claim from the person responsible or their insurer, we will be able to reimburse your excess.
Take the time to check your policy’s excess online today, and keep your eyes peeled for the next chapter of our education series!