This post was published on May 7, 2025
Car insurance excess is the amount you are required to pay when you make a claim with an insurer. Think of it as the portion of the damage or repair costs that you’re responsible for paying before your insurance kicks in. An excess is payable regardless of whose fault the incident was.
An excess is important because it not only keeps your premiums affordable, but having an excess, insurers reduce the chance of drivers filing multiple small, frivolous claims. It also encourages better decision-making and more cautious driving.
If you’re interested in understanding more about how excess payments work, read this helpful article: What Is an Excess Payment and How Does It Work?
Can You Claim Your Excess Back?
At iWYZE, we understand that paying an excess can be frustrating, especially when the accident wasn't your fault. The good news is that if another party is responsible for the incident, our legal recoveries team will work hard to recover your excess. However, it's important to note that recoveries aren't always guaranteed. Should the legal recoveries team be successful in recovering the excess, it will be paid to the claimant in full.
Using Excess to Reduce Your Monthly Premium
One of the most powerful ways to reduce your monthly car insurance premium is by adjusting your standard excess. What is a standard or basic excess? This is the standard or often referred to as the minimum value excess payment you could likely pay when submitting a claim. Increasing your excess usually results in a reduction in your premium. This works because higher excess amounts shift more of the financial responsibility onto you in the event of a claim, thus reducing the insurer's risk. However, this strategy should only be used if you’re sure you can afford to cover the higher excess amount should you need to file a claim.
For example, while it might seem tempting to increase your excess to R50,000 in exchange for a lower premium, it's important to consider whether you have enough savings to cover such a high excess if an incident occurs. It's all about balancing cost savings with financial security.
Types of Excesses That May Apply to You
Understanding the various types of excesses that may be imposed on your policy can help you avoid surprises when the time to file a claim comes. Here are a few examples:
1. Driver Under the age of 25 and or driver with a driver’s licence that is less than 3 years old: Younger and or new drivers often face higher excesses due to their inexperience and higher likelihood of being involved in an accident. If you're planning on letting a younger driver use your car, consider whether you can afford the potential additional excess costs if an accident occurs.
2. Night-Time Driving (22:00 - 06:00): Statistically, accidents are more common at night. This excess reflects the added risk associated with driving in low-visibility conditions. If possible, avoid driving during these hours, or at least ensure that you are aware of the added excess if something goes wrong.
3. Not the Regular Driver or Spouse: Allowing someone else to drive your car could result in an additional excess. Insurers often impose a higher excess if the car is driven by someone who isn’t the regular driver or their spouse. If you need to lend your car to someone, consider whether it's worth the potential financial impact.
4. Claiming within 6 months of taking up policy: This excess is to reduce fraudulent claims. Customers moving to a new insurer may use it as an opportunity to get new wheels for example, or to get repairs done for damage that occurred before joining the new insurer. This also helps insurers accumulate premiums for at least 6 months before they need to pay a claim as the claim for vehicle repairs is likely to exceed the premiums received and if not managed correctly the insurer will not be able to sustain itself for much longer.
Your car insurance excess can seem like an unnecessary expense, but when used correctly, it can be a valuable tool to help lower your premiums. Just make sure to choose an excess amount that is manageable for your financial situation. If you're in a position to pay a higher excess, you could see significant savings on your premiums in the long run.
The purpose of excess payments is to promote safer driving and help insurers manage their financial risks, ensuring they can continue providing cover in the future. Be sure to understand the excesses that apply to your policy. As an iWYZE policyholder, you can easily access your policy documents through our app, wyzeHUB available on the App Store and Google Play Store.
#wyzemove: Know your excess amount—this is what you’ll pay before your insurer covers the rest of the damages.
