What is voluntary excess on car insurance?

Voluntary excess is an amount you choose to pay towards a claim, on top of the compulsory excess your insurer sets. The two are added together, and the total comes off any payout. The Financial Ombudsman Service describes the excess as “the first part of a claim” that you pay yourself (ombudsman decision DRN-3414585).

Picking a higher figure can bring your premium down. The catch is that more of your own money goes in when something goes wrong. Here is how the sums work, when you pay, and how to pick a level you can live with.

What is the difference between voluntary and compulsory excess?

The compulsory part is fixed by the insurer, while the voluntary part is the extra amount you pick when you get a quote. One policy wording quoted by the ombudsman puts it plainly: you “may also choose to add a voluntary excess, and this amount is set by you” (decision DRN-5652051).

	Compulsory excess	Voluntary excess
Who sets it	The insurer	You, when you get a quote
Can you remove it?	Not usually	Yes, many quotes let you choose zero
Effect on price	Already built into the quote	A higher choice can lower the premium
When you pay it	On each claim under the policy	On the same claim, added to the compulsory part
Where to find it	Your policy schedule	Your policy schedule

Where can you find your excess?

Look at your policy schedule, which lists every excess that applies. Insurers must also give you an Insurance Product Information Document (IPID), a short summary of the significant terms (Financial Ombudsman Service). If more than one figure applies, the schedule shows which is which.

How does the total excess work when you claim?

Your insurer adds the compulsory and chosen amounts together and either takes that total off the payout or asks you to pay it, depending on how the claim is settled. On a fully comprehensive policy, that is the money you put in towards repairing or replacing your own car.

A worked example from a real write-off

In one case the ombudsman looked at, a driver’s car was written off after an accident. The insurer valued it at £12,950 and took off a £500 excess, so the offer was £12,450. The driver queried the deduction. The ombudsman found it was correct, because £500 was listed under the excess heading of the policy (DRN-3414585).

Write-off payouts are based on market value, which is what the car was worth just before it was damaged or stolen (Financial Ombudsman Service, motor valuations and write-offs). The lower that value, the bigger the share the excess takes.

Does a higher voluntary excess make car insurance cheaper?

It can, because you are agreeing to carry more of each claim yourself, but the saving varies from one insurer to the next. In one ombudsman case study, an insurer explained that the renewal discounts it had offered were based on changes to the excess and the level of cover (Financial Ombudsman Service case study).

When a big excess backfires

In a separate complaint, a driver was told the maximum excess on his quote was £650. He reckoned his car’s market value might be about £650 too. That meant a claim for damage to the car itself could have paid out little or nothing (DRN-5830684). A cheaper premium is no bargain if the excess swallows the claim.

How much excess should you choose?

Choose the highest total you could pay at short notice without borrowing, and no more. This checklist helps you test a figure before you buy:

• Add the compulsory and chosen amounts. That total is what you would pay on every claim, not once a year.
• Compare the total with what your car is worth today. If they are close, a claim on your own car may not be worth making.
• Run quotes at two or three excess levels and see how far the price actually moves. A small drop may not justify a big jump in risk.
• Check for extra excesses on the schedule, for example for younger or provisional drivers. If that applies to you, our young driver insurance page explains what else affects the price.
• Look for separate windscreen, theft or fire excesses, which can differ from the main figure.
• Read the policy wording or ask the insurer if anything is unclear. Policies vary.

Putting the checklist to work

Take Aisha, who drives a ten-year-old supermini to her job in Leicester and keeps a modest emergency fund. She runs quotes at three excess levels. The middle option trims the price a little, while the top one saves a bit more but pushes her total excess close to her savings. She picks the middle level, because she could pay it next week without touching a credit card.

Do you pay the excess if the accident was not your fault?

If you claim on your own policy, usually yes. One wording quoted by the ombudsman says you are responsible for paying all excesses “even if the incident is not your fault” (DRN-5652051). Your no claims bonus may also be affected until your insurer recovers its money from the other driver’s insurer (Financial Ombudsman Service).

After a non-fault accident, the ombudsman lists three main routes (Financial Ombudsman Service, credit hire):

• Claim on your own policy, pay the excess, and let your insurer pursue the other side.
• Recover your costs directly from the at-fault driver’s insurer.
• Use a non-fault service from an accident management company. There is no excess to pay upfront, but if the other insurer refuses to pay, you might be held responsible for the costs.

Some policies also promise to refund the excess if an uninsured driver hit you. The conditions matter. One ombudsman complaint turned on whether the driver had given the details the policy asked for, after the other car was found on cloned plates (DRN-3756935).

Can you change your excess after you buy?

Yes, you can pick a new level each time you renew or get a fresh quote. Changing it partway through a policy depends on the insurer. If you ask, get any change to the premium, and any admin fee, confirmed before you agree.

Is excess protection the same as voluntary excess?

No. Excess protection is a separate policy that pays you back for an excess after a claim, while the voluntary amount is a setting on your car insurance. Renting a car brings its own excess on the rental agreement, which car hire excess insurance is designed to cover.

If your car is on finance, a write-off pays its market value, which may be less than you owe. GAP insurance covers the difference between that payout and an agreed amount, such as what is left on the loan (Financial Ombudsman Service, GAP insurance).

Common questions about car insurance excess

What is compulsory excess on car insurance?

It is the part of the excess your insurer sets and you cannot usually remove. It applies to every claim, and any voluntary amount you choose is added on top of it. Your schedule shows the figure.

Is it better to have a high or low voluntary excess?

Neither is right for everyone. A higher figure can lower the premium, but you pay more when you claim. Pick a total you could pay at short notice, and keep it well below your car’s value.

Do I pay the excess if someone else hits my car?

If you claim on your own policy, you usually pay it first, even when the other driver was to blame. You may be able to recover it from their insurer, and some policies refund it if an uninsured driver hit you.

What to do next

When you compare quotes, look at the total excess next to each price, not just the premium. Two prices that look alike can carry very different excesses. Find out more about cover on our car insurance page, or get car insurance quotes with Tiger.co.uk and compare deals in a few minutes.

Tiger.co.uk compares quotes; it is not an insurer. Policies vary, so read the policy documents before you buy.