What is home insurance excess?

Written by Mehdi Punjwani

Reviewed by Beth Leslie

5 min read

Updated: 14 May 2025

In this guide / article

Key takeaways

The excess is what you contribute towards a home insurance claim before your insurer covers the remaining cost
Most insurance policies have compulsory excess and voluntary excess
Setting a higher excess when you take out cover can make your insurance cheaper

What is home insurance excess?

The excess payment on your home insurance policy is what you contribute towards a claim before your insurer covers the remaining cost.

Insurers charge an excess payment to discourage people from making frequent low-value claims for minimal damage.

Most insurance policies have two types of excess: compulsory excess and voluntary excess.

What’s the difference between compulsory and voluntary excess?

When you run a quote for home insurance, you’ll usually see two types of excess payments:

The compulsory excess payment is the amount you’ll have to pay when you make a claim. It is set by your insurer.

You’ll also have an option to choose to make another excess payment on top of the compulsory sum. Since you're agreeing to cover more of any damage yourself, insurers will usually incentivise this choice with a discount on your premiums.

Insurers also reward higher excesses because it reduces the number of claims being made, since there is no point claiming on your insurance for amounts at or below the excess limit.

No claims bonuses, where you get discounts for going multiple years without making a claim, often mean its not worth claiming on insurance for amounts a bit above the excess, too.

Compulsory excess

Voluntary excess

How do excess payments work when I make a claim?

When you make a claim on your insurance policy, you can pay your excess in two ways:

You pay the excess fee up front to the tradesperson fixing your home, and your insurer then cover the rest of the bill.
Your pay for the damage yourself in full and your insurer refunds you, but deducts the excess fee from the total payout

If your excess payment is higher than the total cost of the damage, it is not worth claiming on your insurance. It may also be worth paying for the damage yourself if the total cost is only slightly above your excess amount, because once you claim you'll lose your no-claims discount.

Can a higher voluntary excess bring down my insurance premiums?

Yes, volunteering a higher excess when you take out cover can bring down the overall cost of your home insurance.

Here's how much you could save on your combined home insurance premiums, on average, by adjusting your voluntary excess:

Voluntary excess amount	Average saving vs £0 voluntary excess
£50	£7.16^*
£100	£11.07^*
£150	£14.63^*
£200	£17.74^*
£250	£20.74^*
£300	£25.06^*
£350	£27.68^*
£400	£27.94^*
£450	£30.55^*
£500	£31.94^*

When comparing home insurance policies with MoneySuperMarket, you can adjust your voluntary excess amount and see how it affects the cost of the premiums you’re quoted.

How much voluntary excess should I pay on my home insurance?

When you set your voluntary excess amount, it may be tempting to choose a high figure to bring your premiums down - but make sure it’s a sum you’ll be able to afford in an emergency. Otherwise, you’ll find yourself in a difficult situation if something unfortunate happens and you do need to make a claim.

Factor in what type of insurance you’re taking out and what you need it to cover - if you’ve got valuable items that might cost a lot to cover, it may be worth increasing the excess so you can lower the overall insurance cost.

Are excess payments the same for all types of home insurance claims?

No. Some home insurance claims are worth much more than others and will usually require a higher excess amount.

For example:

Claims for accidental damage are often relatively small, so the compulsory excess is likely to be around £100
For things like flood damage or escape of water the excess is usually far higher
If you were to make a claim for subsidence, your compulsory excess could be in the range of £1,000

Even the highest excesses are usually significantly smaller than the repair costs you’d face without cover. For example, fixing subsidence can cost up to £75,000, according to the Royal Institution of Charters Surveyors (RICS), a professional body.