Excess and no-claim bonus when your car is written off

The excess on a total loss

The excess is your contribution to an insurance claim, and the amount is in your policy schedule. When a car is written off, the insurer usually deducts the excess from the payout.

Whether you have to pay it

Most policies have an excess, and it may not matter whether you were at fault. Some policies say you don't have to pay it if you can show the other driver was entirely at fault, often with their details (such as name, address and registration). Others charge it on every claim, whatever the fault.

Sometimes the insurer recovers the money from the at-fault driver and refunds your excess, but that may not happen, and it can take months or years.

Your policy's product disclosure statement (PDS) sets out when you don't have to pay the excess, and when it's refunded.

If you can't afford the excess

An insurer can't reject your claim just because you can't pay the excess. You can ask for an arrangement to pay it off over time, or ask the insurer to deduct it from any payout.

Other deductions

Depending on your policy, other amounts may be taken off or added in a total loss settlement. You can ask your insurer for a written breakdown and check each item against your policy.

Your no-claim bonus

A no-claim bonus is a discount on your premium that usually grows for each year you don't claim. An at-fault claim usually means losing the bonus or having it reduced. Not being at fault doesn't always protect it, and insurers may still increase your premium after a claim.

Some insurers sell no-claim bonus protection, which keeps the discount in place after a claim but doesn't stop your premium going up. Your policy sets out exactly how a claim affects your bonus.

The biggest number is the market value

The excess and any other deductions come off the market value figure, so the market value is the biggest number in the settlement. You can check it against cars for sale in your state.

Do I pay the excess if my car is written off?

Usually the insurer deducts the excess from the total loss payout. Whether an excess applies depends on your policy, and some policies waive it if you can show the other driver was entirely at fault.

Can my insurer refuse my claim if I can't pay the excess?

No. An insurer can't reject a claim just because you can't pay the excess. You can ask to pay it over time or have it deducted from the payout.

Does a write-off affect my no-claim bonus?

It can. An at-fault claim usually means losing or reducing the bonus, and even a not-at-fault claim can lead to a higher premium. Your policy sets out the rules.