Excess isn't a penalty for claiming — it's a cost you agreed to when you took out the policy, split into two parts that work differently.
Compulsory excess: set by the insurer, non-negotiable
Compulsory excess is fixed by the insurer based on how they assess your risk — factors like age, driving experience, the type of vehicle or property, and prior claims history. You can't remove or reduce it; it's built into the policy you agreed to.
Voluntary excess: your choice, and it affects your premium
Voluntary excess is the extra amount you choose to add on top of the compulsory excess when you buy the policy. Choosing a higher voluntary excess typically lowers your premium, but increases what you'll need to pay if you claim — so it's worth setting an amount you could genuinely afford at claim time, not just whatever lowers the quote most.
How they combine at claim time
Both amounts apply together. If your compulsory excess is £200 and your voluntary excess is £300, a successful £1,500 claim pays out £1,000, with £500 total excess deducted — regardless of who was at fault for the incident.
Calculating what you'd actually receive
Before assuming a claim is worth making, add your compulsory and voluntary excess together and subtract that total from the estimated claim value. For smaller losses, this can mean a claim isn't worth making at all once the excess is factored in — and making a claim can also affect your no-claims discount even when the payout is small.
Sources
Related Kibbo Tools
- Insurance Policy Coverage Checklist — confirm your excess, limits and exclusions before assuming what a claim is worth.
- Insurance Claim Expense & Reimbursement Tracker — track the real numbers, including excess deducted, as your claim progresses.