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Insurance Excess To Save Money


Yes you read the title correctly.

When you took out your fully comprehensive motor insurance policy, there is a good chance there was a compulsory excess amount quoted to you, which you were able to increase or reduce depending on how much extra you wanted to save or spend, respectively.

Obviously we are all different, but there are a lot of people who would not bother to claim on their policy for a small mishap or most likely anything below a certain comfort figure. Most people know a claim will increase their policy next year, the following year, and the one after that, so in order to save those costs, in the case of a mishap that was their own fault (or they couldn’t find the third party or s/he had no insurance etc) they will usually pay to fix the damage out of their own pocket. This can often go for figures as high as £1,000.

But if you are willing to do this, then make sure you benefit!!! Tell your insurer to increase your excess, to whatever figure you are happy to accept. Check the price for cover at various levels of excess, and choose the most value for money. This will most likely benefit those with very expensive or sports vehicles, with annual insurance premiums in excess of £1,500. But be sure to test various levels of excess, as there is little point taking a £2,000 excess when it will only save you £30.

Beware also that the excess is per claim, and also applies if your vehicle is stolen or a total loss. Therefore it is important to find a good balance that suits you and saves you a decent amount of money. £500 to £1000 excess is usually the most efficient.

Young drivers are also likely to benefit from this method, because it is per claim, and statistics show that young drivers are most likely to have accidents, this excess means they don't pay out as much for their own insured if he has several accidents in the year. Of course they will still have to pay the third party costs.

What about someone who crashes ten times in one year? With a £500 excess, and assuming the claim runs the entire 500 each time, it means they would have paid out £5,000 in one year on repairs. An excess of some kind is usually included in anycase, often about £150. This scenario means that even if the policy saved £500 on the premium, they would have lost out on about £3,000. What does that suggest? Most logically, that the driver in that scenario should give up driving!










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