Increasing your excess… Is it worth it?
When you take out an insurance policy your insurance company will ask you to pay an excess towards any claim you make on your insurance policy.
Most insurance companies have a standard basic excess which is set by them. From there, you have the option in some cases, to lower or increase your excess amount. If you vary from the insurers standard basic excess, you must expect your premium to change as well.
Choosing a higher excess may in some instances calculate a cheaper premium and your insurance policy will cost less in the long run, so long as you don't make a claim.
If you decide to increase your excess to save a few bucks on your annual insurance premium you're also agreeing with your insurer that when you need to make a claim on your policy, you will pay out this extra amount.
Prior to you making this financial decision you must first consider whether you can in fact afford your chosen excess amount if a claim where to occur.
Advisr does not provide advice and does not hold a financial service license (AFSL). All information above has been provided by Abbie Wilson.