How does Excess Protector Work?

The concept of excess is not only applicable to car insurance, it applies to all classes of insurances in Kenya and across the globe. While in some parts of the world it is called a deductible, in most parts of Africa excess is the common term.

To understand excess, let’s consider examples of excess in medical insurance and travel insurance policies.

Excess in Travel Insurance

In travel insurance, excesses can be applied in terms of time or monetary cost. For example to claim for travel delays, a time excess of 4-6 hours applies. That means that for the first 4-6 hours of the delay, no compensation is due, compensation is for delays exceeding the first bloc of these hours. Excess in travel insurance can also be monetary, for example to seek emergency medical expenses while abroad, the first USD 50 -100 expense is normally borne by the insured. The travel insurance policy can then pay for additional expenses up to the stated sublimit.

Excess in Medical insurance

For most medical insurance policies in Kenya, an excess applies to the outpatient visits. This is more common for visits to high cost facilities like Nairobi Hospital, Aga Khan, Karen Hospital etc. The insured meets the first cost of up KSh 1,000 before they can enjoy the medical insurance cover up to its stated limit. This is to discourage misuse of the medical cover on small claims that can be managed with rest or over the counter medication at a local pharmacy.

Table showing excesses in a typical comprehensive car insurance for private vehicles in Kenya

Excess	Value
Accidental damage / Partial Theft	2.5% of car value minimum KSh 20,000
Third Party Property Damage	KSh 7,500
Total Theft (w/ Anti Theft Device)	10% of car value minimum KSh 20,000
Total Theft (wo/ Anti Theft Device)	20% of car value minimum KSh 20,000
Total Theft ( w/ tracking device)	2.5% of car value minimum KSh 20,000
Young driver (under 21 yrs)	KSh 5,000
Inexperienced driver (less than 2yrs	KSh 5,000

Excess Protector in Car Insurance

From the above table, it can be seen what kind of out of pocket contributions that a client will make in case of a car insurance claim. The excess protector as the name suggests shields the insured client of these costs. There are two types of the excess protector namely

1. Excess protector for own damage
2. Full excess protector (own damage and theft)

Car Insurance Claim example

Let’s take an example of a car worth KSh 1,000, 000 insured on a policy with the excess terms in the table above.

If it is involved in an accident and upon assessment the damage repair costs are estimated at KSh 200,000

Without Excess Protector

Without this protector, the insured is liable  to contribute 2.5% of the value of the insured vehicle which brings the total to KSh 25,000.

With the Excess Protector

Here the insured does not contribute anything at all. The insurance will foot the full cost of the repairs.

Below Excess

A slight technicality in the excess protector arises if the cost of repairs is below the excess for the particular vehicle. From the example above if the repair cost was KSh 10,000. The insured client would meet the costs of the repairs because it is below the minimum excess value of KSh 20,000.

In addition if the repair cost was KSh 24,000,  the insured client would still meet the costs of the repairs because it is above the minimum excess value but below the excess value of the vehicle which is KSh 25,000 (2.5% of KSh 1 million)

Cost of Excess Protector

Most car insurance quotes in the market don’t include the excess protector, they are offered as basic cover with the option to addon excess protector, political violence and terrorism cover, personal accident cover, aa rescue etc. Therefore check your quote carefully, ask your broker/agent to explain the details to you.

This excess protector for own damage goes for between 0.2-0.5% of the market value of the vehicle subject to a minimum premium of about KSh 1,500.

The full excess protector which covers not only own damage but also theft goes for 1-1.5% of the value of the vehicle with a mimum value of between KSh 5-10,000

Note:

Shop around when getting a car insurance cover, many motor insurance companies in Kenya don’t offer excess protectors because of consistently high claims losses. For example, very few providers offer this addon for PSV cars on online apps like UBER/Taxify/LITTLE. This forces customers to contribute to repair costs in case of an accident claim and therefore forces them to exercise extra care when driving.

Also note that once the Excess Protector has been used to shield the client from repair costs when a claim has been lodged it is considered utilised and finished. Therefore, it has to be reinstated back on the policy at the prevailing market rate.

NEED A QUOTE?

If you are looking for a quotation for your motor insurance cover, want to compare the benefits, limits of liability, favourable excess terms and ultimately get a good, check out www.pesabazaar.com to get a comparison of up to 15 quotes online instantly.