14% of UK adults do not understand how insurance policy excesses work

A fifth say they don’t understand the difference between voluntary and compulsory excess

One in seven UK adults (14%) admit they have no understanding of how excesses on insurance policies work, according to new research* from GoCompare car insurance.

Of the 2000 people who were interviewed as part of the research, a fifth – 21% - also said they don’t understand or are not sure of the difference between compulsory and voluntary excess when asked by the UK comparison site.

A further 41% claimed to only have ‘some’ understanding of how excesses work, with just a third describing their understanding as ‘good’.

Excess amounts are included in car, home and most other kinds of insurance policies as the amount a policy holder is required to pay out themselves before further costs can be claimed from the insurer.

The total excess is made up of a compulsory excess and voluntary excess amount - the two excesses are added together and must be paid upfront, or are deducted from any settlement in the event of a claim. The compulsory excess is set out by the insurer and cannot be changed. The voluntary excess is an amount chosen by the policyholder, often in exchange for a lower monthly premium, and is payable on top of the compulsory excess. 

If someone then needs to make a claim on their insurance policy, the value of that claim must exceed the total excess. For example, if the voluntary excess and compulsory excess are both £250, the total excess is then £500. But if the value of repairs  was less than the £500, a customer would not be able to claim.

Commenting on the findings, motoring expert Ryan Fulthorpe, said, “If we think about how many insurance policies the average householder in the UK takes out on a yearly basis, it’s concerning that more people don’t know how excesses work, many of whom could be in for a nasty surprise when it comes to claim time as a result.”

“If you are lucky enough to have never made a claim against your home or car insurance, for example, it can be easy to believe that as long as the premium price quoted is reasonable that’s all that matters when taking a policy out,” Ryan continued.

“But the small print can suddenly become a very big deal when you are faced with having to recoup your costs due to an accident, a break in or some other relevant scenario, particularly if a proportion of those costs fall directly to you without you being prepared for it.

Another consideration is remembering that you will need to pay the excess if you need to make a claim. Some people may opt to increase the voluntary excess on a policy when they’re shopping around, which may mean cheaper annual or monthly payments, but you need to make sure that you can afford to pay the total excess in the event of a claim.”

The research showed that the younger a person is, the less likely they are to understand insurance excesses. A quarter of 18 to 24 year olds said they do not understand insurance excesses at all, and only 12% described their understanding of them as ‘good’.

One in five 25 to 34 year olds and a quarter of all those aged 35 to 44 said their understanding of excesses was ‘good’, meanwhile, with a half of all those aged 45 and above claiming the same.

“As an industry, we should be mindful that there is clearly still much to be done when it comes to equipping householders, drivers and other adults in the UK with the knowledge they need to make sure their possessions and loved ones are properly protected against the pitfalls that running a home, a car and taking responsibility for any other assets in life can bring,” Ryan added. 

“Excesses are a fundamental part of pretty much any insurance policy available on the market today –so it does raise concerns about anything else that they might be missing in the process of taking out an insurance policy. It’s often said, but reading the terms and conditions of a policy is really important when it comes to insurance. Price is always going to be a big factor when making a decision on a policy, but a saving on your premium needs to be measured against not having the right cover in place.

Currently, drivers shopping around for car insurance with GoCompare can benefit from its free £250 excess cover. More information on GoCompare Car Insurance’s free excess cover can be found at:

For more information on excesses, please visit:     


For further information please contact:

Lynsey Walden or Kath Chadwick at Gocompare on or

Keep up-to-date with GoCompare on Twitter; @GoCompare

* Between August 6th and August 9th 2021, an online survey of 2,034 randomly selected Great British adults was executed by Maru/Blue. For comparison purposes, a probability sample of this size has an estimated margin of error (which measures sampling variability) of +/- 2.1%. The results have been weighted by age, gender, region and social grade to match the population, according to Census data. This is to ensure the sample is representative of the entire adult population of Great Britain. Discrepancies in or between totals are due to rounding.

**Offer applies to fully comprehensive policies and is open to anyone who buys a valid car insurance policy from GoCompare during the offer period.  The policyholder must be 17 years of age or older and a permanent UK resident. The customer will qualify for the free excess protection cover for the duration of their car insurance policy (12 months max).  Excess Protection Insurance is provided by a separate policy, underwritten by AXA Assistance (UK) Ltd.

About GoCompare

GoCompare is a comparison website that enables people to compare the costs and features of a wide variety of insurance policies, financial products and energy tariffs.

It does not charge people to use its services and does not accept advertising or sponsored listings, so all product comparisons are unbiased. GoCompare makes its money through fees paid by the providers of products that appear on its various comparison services when a customer buys through the site.

When it launched in 2006, it was the first comparison site to focus on displaying policy details rather than just listing prices, with the aim of helping people to make better-informed decisions when buying their insurance. It is this approach to comparing products that secured the company an invitation to join the British Insurance Brokers’ Association (BIBA) in 2008, and it is still the only comparison site to be a member of this organisation.

GoCompare has remained dedicated to helping people choose the most appropriate products rather than just the cheapest and works with Defaqto, the independent financial researcher, to integrate additional policy information into a number of its insurance comparison services. This allows people to compare up to an extra 30 features of cover.

GoCompare is part of Future Plc and is authorised and regulated by the Financial Conduct Authority (FCA).

More information can be found here or here


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