1. Compulsory Excess

• Definition:
  A fixed amount set by the insurer that the policyholder must pay in the event of a claim. It cannot be altered or avoided.
• Purpose:
  Ensures the policyholder shares some financial responsibility, reducing the insurer’s risk.
• Example:
  In car insurance, a young or inexperienced driver might have a higher compulsory excess due to their higher risk profile.

2. Voluntary Excess

• Definition:
  An additional excess amount chosen by the policyholder to reduce the premium cost.
• Purpose:
  Provides flexibility for the insured to lower their premium by agreeing to pay more out of pocket during a claim.
• Example:
  A homeowner may choose a higher voluntary excess to make their home insurance policy more affordable.

3. Standard Excess

• Definition:
  A baseline excess amount applicable to most claims, set in the policy terms.
• Purpose:
  Covers general claims not subject to specific excess types.
• Example:
  A health insurance policy might have a standard excess for hospital admissions.

4. Age-Related Excess

• Definition:
  An additional excess imposed based on the age of the insured or individuals covered under the policy.
• Purpose:
  Reflects the higher risk associated with certain age groups.
• Example:
  • Young drivers under 25 often have a higher excess in car insurance.
  • Elderly travelers may face higher excesses in travel insurance policies.

5. Specific Excess

• Definition:
  An excess applied to specific types of claims or coverage areas.
• Purpose:
  Targets particular risks or circumstances that the insurer deems higher or separate from standard coverage.
• Example:
  • Windscreen repair or replacement in auto insurance.
  • Flood damage in home insurance policies.

6. Aggregate Excess

• Definition:
  A cumulative excess applied across all claims made during the policy period. Once the aggregate excess is met, the insurer pays for subsequent claims.
• Purpose:
  Limits the insurer’s liability until the insured has contributed a specified amount.

7. Deductible Excess

• Definition:
  Similar to compulsory excess but often used interchangeably with the term “deductible,” particularly in health or property insurance.
• Purpose:
  Encourages the insured to manage smaller expenses independently.

8. Policy-Specific Excess

• Definition:
  An excess unique to the terms of a particular policy or provider.
• Purpose:
  Allows customization based on specific risks associated with the insured or the asset.
• Example:
  • High-value items in contents insurance may carry a unique excess.
  • Event insurance may have an excess for claims related to weather disruption.

9. Excess Waiver (Optional)

• Definition:
  An add-on feature where the policyholder pays an additional premium to eliminate or reduce the excess.
• Purpose:
  Provides peace of mind by ensuring minimal or no out-of-pocket expenses for claims.
• Example:
  Rental car insurance often offers an excess waiver to avoid paying the excess for damages.