Mixed feelings about Excess? What is it really?

Your laptop has just been stolen and you need to claim. You follow all the steps on the Granadilla app with Wayde our claims bot. You’ve uploaded all the documents needed and now you need to pay an excess. Excess!? What is it, how much is it and why weren’t you told about it?

If you are unaware of what excess is or why you’re required to pay an excess when you claim from your insurer, you’re not alone – it’s quite common for first-time insurance users or claimants to be caught off guard. Let’s quickly unpack it so that you are in the know…

1} As an insurance policyholder, one of your obligations, besides paying your monthly premium, is to cover a portion of your risk yourself. An excess is simply the uninsured portion of your cover and you pay for this portion of self-cover only when you need to claim.

2} Insurers usually either have a fixed excess amount or an excess calculated at a certain percentage of your item’s insured value. The office of the Ombudsman for Short-Term Insurance says “When the amount that is claimed is less than the excess amount, no payment will be made by your insurer.”

3} Insurers use excess as a way to discourage fraudulent and small value claims, where the cost to administer the claim exceeds the cost for you to pay for the loss or damage yourself. Eliminating small value claims and their high administrative costs helps keep monthly premiums lower for you and other policyholders, thus ensuring that insurance doesn’t become unaffordable.

How does Granadilla calculate excess?

When you insure with Granadilla, your excess will differ from product to product. For travel cover, our excess is set at a flat rate of R500 per claim. For all portable possessions and gadgets, the excess is calculated on a sliding scale starting at 15% of the insured value you’ve stipulated in your policy and thereafter drops by 2.5% each following claim-free month until it stops at 7.5%. For jewellery, it goes down further until it stops at 5%. Should you submit a claim, your excess calculation will reset and the process starts at 15% again, dropping by 2.5% each claim-free month.

Your excess amount will always be shown to you in your quote and also stipulated in your policy documents. For Granadilla customers, these are easily accessed through the app where you can view and download them at your leisure. 

Love, peace, Granadilla-grease!