Setting your excess level is part and parcel of the process of buying insurance. So when it comes to choosing the right policy with the right excess, what special considerations apply when getting your caravan or motorhome covered? This guide is designed to help you find out…
Compulsory and voluntary excess explained
An excess is the amount that you agree to pay towards any claim made on your policy. The first element of this is the compulsory excess: the set amount as determined by your insurer. For a motorhome, this is usually determined by the value of the vehicle.
The second part consists of the voluntary excess: an additional amount that you agree to contribute in the event of a claim. Generally, the higher the level of voluntary excess you choose, the lower the cost of the premium.
Setting your voluntary excess: how to get the right balance
The flipside of a high voluntary excess is the fact that you are required to pay a bigger amount towards any claim. So setting your excess is often referred to as a balancing act; you want to keep your premium low, but you still want to be able to put your policy to good use if a claim arises.
To strike the right balance, leisure vehicle owners should pay particular attention to the following:
Swallowing the costs: how much can you afford?
Let’s say you are considering selecting a voluntary excess of £400 for accidental damage on your motorhome insurance. This is in addition to a compulsory excess of £100 (so your total excess is £500). The key question to consider is whether you are comfortable with the prospect of being required to meet the first £500 of any claim.
This could be a bill from the repairing garage, or, in the event that the vehicle is written off, a deduction of that amount from the total loss settlement. If you opt for a relatively high excess, it’s a good idea to budget for the possibility of a claim. The simplest way of doing this is to earmark an amount of cash equivalent to the value of the excess and ensure that it is left in your bank account.
Making sure you still gain a material benefit from the policy.
The right insurance policy should be affordable and should take into account the specific ways in which you are going to be using your caravan or motorhome. But crucially, it should also be there if you need it. By selecting a high voluntary excess, you could be effectively pricing yourself out of being able to rely upon the policy in the majority of circumstances where you might need it.
Caravan contents is a good example of this. If the value of your excess for this is far greater than the value of the items you take on holiday with you in the caravan, you are guaranteed to never benefit from the policy for a contents claim.
Is a higher excess worth it? Check the effect on premium prices.
In short, if you choose to increase your excess, how much are you going to save on the amount you have to pay for the policy? A good insurer will be totally transparent and when going through you excess options, will set out what each excess level means in terms of annual policy costs. Armed with this information, you can then make an informed decision on what level of excess works best for you.
The other driver was at fault. Can I claim back my excess?
If your caravan or motorhome is damaged due to the fault of another driver, and your insurers are able to recover their full outlay from the other party, your excess is refunded. If the claim is disputed, it can be especially useful to have a specialist caravan and motorhome insurer on your side - to maximise the chances of your claim being settled in your favour.
Will I get a better deal on my policy excess through a price comparison site?
It’s sometimes assumed that price comparison sites are the go-to destinations for the best deals on insurance – but our recent survey suggests that this isn’t the case. More than three quarters of consumers found that the average policy excess was the same price or higher when buying through a policy through a price comparison site.
For a competitively priced policy with a low excess, it’s important to see what’s available from individual insurers. This allows you to tailor your policy to suit your specific requirements with support from a specialist team who understand possible claims scenarios. Going direct cuts out the middle man and ensures you receive the most appropriate policy in terms of breadth of cover, features and benefits, excess and exclusions rather than focussing exclusively on price.
Are there any other problems with price comparison sites when it comes to setting an insurance excess?
Yes. Moneywise looked into this in 2013. They found that when policies are listed and ranked, it can be hard to compare like for like. When results are displayed, some might include a voluntary excess, whereas others might not. In our research, a quarter of respondents were disappointed with their experience of using a price comparison website and a third felt that such sites provide worse value for money than individual insurers.
Inconsistent pre-selection of voluntary excesses was not the only problem with price comparison websites highlighted in our study. To read the full results, check out our infographic. For tailored cover and a range of excess options on motorhome and caravan insurance, get an online quote today or request a call back at a time that’s convenient for you.