What is an Insurance Excess?

We often get queries about the insurance excess on their plans from our customers, asking how an excess works and why they need to pay an excess.

Below is a short explanation of insurance excesses and how they are applied. We hope this helps to answer any questions.

What is an insurance excess?

Excess is the amount you have to pay of a claim you make on your policy. If you make a claim and it’s accepted, your insurer will pay for the costs you submitted that are over your excess amount.

The excess amount will differ depending on the type of policy you have. The amount of excess is specified on your policy.

Why is an excess charged?

An excess can be seen as a form of self-insurance. It helps to avoid many small claims and keeps premiums low for everyone who is insured.

How does the excess work?

Let’s look at an example where your policy has an excess of $75.00. If you are unwell and have incurred medical costs of $200 for your treatment, you would need to pay the first $75.00 of the costs you had incurred, and the insurer will pay the remainder of the costs, which is $125.00.

If the matter did not improve and you returned to the doctor and pay $100 more for treatment, 100% of that $100 would be refunded under your insurance policy.

It’s important when purchasing a policy to know if your policy has an excess. Some OrbitProtect insurance policies have excesses for some benefits. Make sure you check the policy wording.

 

This page was last updated in July 2024 and reflects the way that excesses are managed with OrbitProtect policies. There may be differences with other insurers.