Hi all,

Just a quick non CC related question for anyone who works in the
Insurance industry.

In relation to Car policies, can anyone advise me as to
the rating factors affecting the Excess payable on a policy?

I'm not interested in the actual premium calculation, just the excess
on a policy, assuming, 3rd party F&T.

Just interested at the moment as to other companies rating methodologies
given my excess has jumped by £100 although the premium has dropped.

Apparently they rate the Excess on Post code only.


Humm.....

Car kept on road outside 2 bed terrace behind a parade of shops
with two late night convenience stores. OR

Car kept on Drive way in quiet Cul-de-sac...
And the higher risk is?

I'm confused.

Any info greatly appreciated as I can't understand how a premium can drop
but the excess increase, not that I realised it was variable anyway, that
seems to have been omitted from the policy docs.

Regards

DaveA

Our company only handles health insurance calls, but I've never heard that term here in the US and I recently reviewed my auto policy. Would Excess=Deductible?

I believe so.

The amount you pay on a claim before the insurance takes over.

Thanks

DaveA

I know that my deductable/excess varys greatly dependant on many factors, some of them being:

age (<25 and they go WAY UP)
postcode/location (this is a big one for car insurance or home insurance)
types of vehicle
useage of vehicle
history of insurer
the mayan solar calendar

Normally here you can pick your excess/deductible but you will have to pay more/less on your monthly fee's.

When last changing insurers, there was a choice of excesses with a different premium against each. The calculation ought to reflect the additional cost of making the higher payout (in the event of a lower excess) modified by the probability of having to make it. I'd add to Justin's list the value of the car. Also, there are costs which insurers may handle in different ways. Take the authorised repairer's man hours spent on locating parts for unusual models. It can lead to unexpected write-offs and book value payouts. You'll know what's important, so put the relevant questions before you sign. If, for instance, you drive one with those four cornered wheels that don't lose their grip going down the side of a pyramid, you're best off looking for insurers using Mayan solar calendar weighting or specialising in rack railways.

and of course, the higher your excess/deductable the more of the risk you are sharing with the insurer so the lower your premium should be. There's all kinds of things that effect the calculation, age, driving record and so on..and we won't even mention physical or moral hazards.

Mainly I'm on about the compulsory excess.

What's happened is....

Whilst my premium has dropped moving from one address to the
new one, for some reason the compulsory excess has jumped by £100.

They are saying, whilst premium is rated on many factors the excess is rated
on one only. The postcode.

What I'm after is is this standard for all UK insurers?

As I understand it the basic tenet of insurance is..

Lower risk = Lower premium.

Therefore, if the risk has dropped (hence the lower premium)
how can the excess jump? Unless they're loading the excess as
a method of dropping the premium.

Now I can't find ANY mention in the docs anywhere of this.

I'm also a bit narked that I found this out from the Certificate of insurance rather than at any point before in the updating process.

I know I'm on a hiding to nothing, but I'm interested to know if other insurers
do it the same way.

Regards

DaveA

There are usually more reasons to impose a particular level of compulsory excess than just postcodes Dave - age and driving experience to name just two.

Motor insurers try hard to "dice" each individual risk so that they can be as competitive as possible for each person (it is a commodity market these days and most people buy simply on price)

Your point about:"Unless they're loading the excess as a method of dropping the premium." is, I think, often a fair one.

It's hard to comment on the whole market but good comparison sites will give you a feel for the variations in excesses and in premiums (no doubt you have already done this)