Understanding your insurance excess: A guide for motorists
Many drivers are unaware of how their insurance excess works until they need to make a claim. Learn what excess is, the different types, and how to manage it to keep your costs in check after an accident
Many motorists don’t pay attention to their insurance policy.
The first time they truly pay is when they need to submit a claim after an accident. One of the most common areas of confusion is the excess, the portion of the claim you are responsible for paying out of your own pocket.
Juan Hanekom, national director of the South African Motor Body Repairers’ Association (SAMBRA), and a proud association of the Retail Motor Industry Organisation (RMI), says the association regularly receives queries from customers who are uncertain about how their excess works.
SAMBRA represents almost 1 000 motor body repair businesses across South Africa and accounts for the majority of all insured repair claims in the country.
Hanekom highlighted that the primary purpose of an excess is to discourage small or unnecessary claims. It ensures that insurance is used for significant, unaffordable losses rather than minor repairs, which helps keep premiums more affordable for everyone.
Excesses can vary depending on your policy:
• Standard/basic excess: The insurer’s standard excess for your type of insurance.
• Voluntary excess: An additional amount you agree to pay in exchange for lower monthly premiums.
• Additional excess: Applied if you are deemed high-risk, such as being under 25 years of age or holding a licence for less than two years.
• Imposed excess: Applied due to your claim history or other risk factors.
Hanekom also mentioned that some motorists consider an “excess protector” policy, which covers the agreed excess portion in the event of a claim.
“It’s important that insurers clearly explain these options at the outset or whenever changes occur, so that policyholders know exactly what to expect,” he said.
He emphasised that if another party caused the accident, insurers may attempt to recover this from the other driver’s insurer, but there is no obligation to do so.
“If your insurer doesn’t pursue recovery, you are entitled to do so yourself with their permission. Many motorists don’t realise this, but it can make the difference between losing or recouping that excess amount,” he explained.
He also advised motorists that if they are not happy with their excess, they can pay it upfront to avoid delays in repairs or incurring additional costs, then dispute it with their insurer.
The National Financial Ombud (NFO) advises that if you’re considering a voluntary excess to reduce premiums, you should:
• Understand both compulsory and voluntary excesses in your policy.
• Have clarity on exactly how much, in Rand or percentage, you are liable to pay at claim time.
• Review exclusions carefully as they are often behind claim disputes.
• Compare insurers on offerings like excess waiver options or other protective add-ons.
Hanekom added that if your claim has been reduced or rejected due to excess or related policy terms and you believe it was not properly disclosed or fair, you can approach the NFO. However, clear communication at the point of sale is essential.
“Understanding your excess puts you in a far stronger position when an accident happens. Take the time to discuss your options with your insurer and choose a balance that works for your financial situation. At the end of the day, being informed is the best protection you can have,” Hanekom concluded.
