Travel insurance excess is an amount of money you will contribute towards a claim you make on your policy.
This is often referred to as a ‘deductible’.
Understanding excess is an important part of purchasing travel insurance and many people don’t pay as much attention to it as they should.
Most of us get travel insurance to give us peace of mind when we're on holiday, should anything happen. But really, most of us would prefer not to have to make a claim, especially if the claim is greater than your loss.
Here you’ll find everything you need to know about travel insurance excesses to ensure you can get covered on your terms.
How does an excess work?
If you make a claim, you may find that an excess amount will be deducted, or payable by you, depending on what you are making a claim for. Essentially, the higher the excess is on a policy - the less a provider has to pay out.
For example, if the excess is set at £100 and you submit a claim for £500, the claim payment will be £400.
In the same scenario, if your excess is set £200 you’ll only receive £300 back from your claim.
Who has to pay an excess?
Unless stated otherwise in your policy wording, the excess is generally per person. So, if you’re named on a group, or family travel insurance policy, excess applies to each claim made per individual named on the policy.
So, let’s say four people travel under the same policy and the cost of the holiday is £500 per person. The excess is £200 per person and two travelling companions decide to cancel.
They want to recoup as much of their £1000 holiday back as possible, but they will only receive £600 between them as they have an excess to pay of £200 each.
Although rarer, there may also be times that more than one excess will need to be paid, usually if you make a claim on different parts of your policy. Let’s say you were unwell on your trip and make a claim for your medical expenses, but, you also lost your camera on your trip, and wanted to cover the cost of this too.
Types of travel insurance excess
It’s also useful to know that there are four main types of travel insurance excess.
This is the standard, set amount that your provider indicates you must pay if you end up making a successful claim.
There are some instances where you have the option to select the excess amount yourself before making your purchase. Depending on the amount you select, the premium will usually change (a higher excess amount will mean a lower premium, and a lower excess will mean a higher premium).
Depending on which provider you ultimately go with, you may find that there is an additional excess to consider for claims against certain items.
In order to keep the premium low, some travel insurance providers may include a medical excess to be paid in the event of a claim.
Is an excess always payable?
An excess may not apply to all claims - but this will vary from provider to provider so make sure you check the policy documents of the policy you want to purchase.
The table below might provide you with more of a general idea as to where you can expect excess across the following commonly claimed items:
|Cancellation and curtailment||Yes|
|Medical expenses and repatriation||Yes|
|Total permanent disability||No|
What is an excess waiver?
Some travel insurance providers offer an excess waiver, which is essentially a policy where no excess is required.
This means the provider will pay out the full amount you claim with a nil excess deduction.
If this is the type of policy you're after then it's possible your premium may be higher, and you may see a charge for an excess waiver on your policy, but you’ll know for sure that no excess will be deducted from any successful claims settlement and the cost of your claim will be covered in its entirety.
Paying your excess in the event of a claim
So, at what stage of making a claim does the excess come into play?
Again, this depends on your provider. Some might require you to pay the excess amount before they pay the difference - although most providers will just deduct the excess amount when they pay out (assuming the claim is successful).
Will the excess affect my insurance premium?
Excesses are added to travel insurance policies as an offset to the premium you pay upfront. In other words, if you have a high excess, you tend to pay a lot less on your premium.
This can be a useful way to save if you embark on a lot of short breaks, as there is a lower risk of you having to claim.
However, if you’re going on a trip which involves physical activities - like winter sports, for instance - the risk of making a claim increases.
In this scenario, a high excess will only cause you an unnecessary headache if you do end up claiming, so it’s probably worth paying that little bit extra for a policy with low excess or even look for policies with voluntary excess included, that way you can dictate the excess amount yourself.
What amount should my excess be?
This depends on you. If you’re shopping around for specialist cover for pre-existing medical conditions - you might find that medical cover included in the policy might be to an exponentially greater value than your excess (which is a good thing if your condition is particularly severe).
Checking the excess is all about ensuring you’re getting value for money if you ever need to make a claim. However, we would always recommend that you prioritise getting suitable cover for you and your needs before you start worrying about the excess.Get a quote