Why do I have to pay an excess if I was not at fault?
The main reason for an excess is so that the insurers can eliminate most of, or if not all of, the minor or small claims. If you have an accident and the damage is say R500. To submit a claim to the insurance company it could cost the insurer that amount just on administration charges. Therefore they add an excess to the policy to avoid such minor claims.
Another reason why insurers charge excess’s is to try and avoid fraud. Insurance companies are taken for millions annually due to fraudulent claims, therefore they enforce an excess to try an avoid such claims.
An excess is payable whenever a claim is submitted and is the first payment that needs to be made in the event of a claim – regardless of whether you are guilty or not. The administrative cost of a claim is the same, regardless of who is at fault. If you are not at fault, you can claim the amount back from the other party. Unfortunately, this can take a long time, especially if the guilty party isn’t insured. Our legal recoveries department will do their utmost to recover your excess free of charge.
There are certain circumstances when an excess can’t be recovered, for example:
- the insured doesn’t have any third party details
- the third party doesn’t have any income or assets to attach
- the legal costs outweigh the recovery costs
- the third party can’t be traced
- the merits of the claim don’t justify the recovery.
Why do I have to pay more than one excess?
Your insurance contract covers various levels of risk. This means for instance that, if your vehicle is involved in a motor vehicle accident, and the person driving the vehicle at the time is not the regular driver, we will charge an additional excess as that driver is not the driver on whom the premium is based. These levels determine the excess that needs to be paid.