Hey Advisors!
Let’s be honest, surprise expenses are stressful!
When your clients claim for vehicle or equipment damage, that excess payment can be a nasty shock. As an insurance advisor, you have the power to make things better. This is where Ibiliti’s Basic Excess Cover steps in.
Back to Basics!
What’s Basic Excess Cover?
When someone makes an insurance claim, like after a vehicle accident, they usually pay an “excess” first, and sometimes it’s a LOT. The Basic Excess on an Underlying Policy is often referred to as a basic excess, standard excess or general first amount payable.
Basic Excess Cover is designed to help:
The Ibiliti Excess Cover Policy pays most of your client’s excess if the main insurer accepts the underlying claim. This cover option provides the policyholder with financial support when a claim is made against the Underlying Policy, provided that liability has been admitted by the Underlying Insurer. This means if your client has a valid claim, they can receive benefit of reducing their excess as stated in the policy schedule, minus the inner excess.
This cover is a lifesaver for:
- Private vehicles (sedans, hatchbacks, luxury vehicles)
- Commercial vehicles (bakkies, trucks, buses),
- Plant and heavy machinery (forklifts, graders, etc.)
How Does It Work?
- The main insurer assesses the claim and deducts the excess.
- Your client claims the deducted excess from Ibiliti.
- Ibiliti pays most of the excess (minus a small “inner excess”—usually 10% or at least R1,000).
- Your client only pays that small portion!
Maximum cover limits apply unless endorsed on the policy schedule:
- Private vehicles/motorcycles: to R250,000 (max 15% of value)
- Commercial vehicles: up to R500,000 (max 15%)
- Plant: up to R1,000,000
Comprehensive Insurance Requirement:
To qualify for the Basic Excess Cover, vehicles must be comprehensively insured with a South African Insurer, ensuring the Insured’s Assets are protected against a wide range of risks.
Let’s See It in Action:
Example: Policy Structure at a glance
- Underlying Vehicle Sum Insured: R1,000,000
- Excess applied by Underlying Insurer: 10% of claim value, minimum R10,000
- Excess Cover Sum Insured with Ibiliti: R100,000 (subject to the underlying excess)
- Inner Excess (the insured’s own contribution): 10% of the claim, minimum R1,000 (whichever is higher)
Hypothetical Real-Life Scenarios: With or Without Basic Excess Cover
Scenario:1. Scraped Bumper (Small Excess Claim: Below the Underlying Insurer’s Minimum Excess, often referred to as falling “ within excess”)
Underlying Policy Claim: R9,000 (below insurer’s minimum excess)
Ibiliti Excess Claim: 10% of claim = R900 (falls within the underlying excess)
Without Basic Excess Cover: Client pays the full R9,000 out of pocket. Ouch!!!
With Basic Excess Cover: Ibiliti policy pays R8,000 (after R1,000 inner excess is deducted)
Client pays R1,000
Do you see in this Scenario how the Ibiliti policy steps in and functions as if it was the “Underlying Insurer”, however applies the inner excess?
Do you notice how the Ibiliti inner excess applies to an excess claim? Inner excess = 10% × R9,000 = R900, but since the minimum is R1,000, the insured pays R1,000.
Scenario 2: Partial Repairs (Commercial Vehicle Accident: Typical Excess Claim on a Medium-Sized Loss)
Your client’s delivery truck needs partial repairs after an accident.
Underlying Policy Claim: R250,000
Ibiliti Excess Claim: 10% of claim = R25,000
Without Basic Excess Cover: Client pays: R25,000 out of pocket. It hurts!!!
With Basic Excess Cover: Ibiliti policy pays R22,500 (after R2,500 inner excess is deducted)
Client pays just R2,500
In Plain Language: That’s R22,500 your client gets back—money they don’t need to scramble to find after an accident.
This substantially reduces the cash flow impact at claim stage.
Scenario 3: Write-Off (Large Claim Maximum Excess / Total Loss)
Your client’s delivery truck overturned and is declared a Total Loss.
Underlying Policy Claim: R1,000,000 (vehicle written off)
Ibiliti Excess Claim: R100,000 (Underlying insurer deducts the maximum excess)
Without Excess Cover: The insured is out of pocket for R100,000. Hurts a lot!!!
With Excess Cover: Ibiliti policy pays R90,000 (after R10,000 inner excess is deducted)
Client pays R10,000
Even with big losses, the client’s outlay is capped at the inner excess amount, rather than the large underlying excess.
Scenario 4: Rejected Claim / or did not comply with the Underlying Policy terms and conditions
Underlying Policy Claim: R500,000 (claim rejected due to non-compliance)
Ibiliti Excess Claim: 10% of claim = R50,000
Without Excess Cover: Client pays R500,000. (Oh no, no cover!)
With Excess Cover: Ibiliti policy pays nothing
Client pays R500,000 (Oh no, no cover!)
Excess Cover is not a substitute for valid underlying insurance. Ensure clients understand compliance is essential and policy terms and conditions apply.
Summary Table:
Scenarios at a Glance to recap
| Scenario | Claim Value | Excess Deducted by Main Insurer | What Client Pays without Basic excess cover | What Ibiliti Pays / What the client saves | What Client Pays with Basic Excess Cover |
| 1. Scraped Bumper (Small Claim) | R9,000 within excess | R10,000 | R9,000 | R8,000 | R1,000 |
| 2. Partial Repairs (Medium Claim) | R250,000 | R25,000 | R25,000 | R22,500 | R2,500 |
| 3. Write-Off (Large Claim) | R1,000,000 | R100,000 | R100,000 | R90,000 | R10,000 |
| 4. Rejected Claim | R500,000 | — | R500,000 | R0 | R500,000 |
While Basic Excess Cover offers fantastic peace of mind, there are some important exclusions you (and your clients) need to be aware of:
- Any loss or damage to accessories added after the original purchase (like radios, telephones, etc.) isn’t covered.
- Claims involving vehicles used in activities specifically excluded (see policy wording) will not be honoured.
- Any claim not covered by the Underlying Insurer
- Opting for a voluntary excess to reduce premiums.
- Any other excess that doesn’t qualify as a basic excess is excluded. This includes (but isn’t limited to) excesses for theft or hijacking, total loss claims, windscreen claims (except for Buses), third-party excesses, or any additional excesses applied by the Underlying Insurer. Cover is available upon request subject to additional premiums payable and must be specifically detailed to be covered under the other sections of the policy.
It’s really important for clients to know these exclusions upfront to avoid disappointment during the claims process.
Keys to smooth sailing at claim stage
To keep things running smoothly, make sure your clients know these key responsibilities:
- The premium for excess cover must be paid timeously and the asset must be specifically noted on the schedule
- Policyholders must keep comprehensive insurance active on all vehicles and each vehicle/trailer must be individually insured.
- Policyholders must give honest, accurate info about how vehicles are used and any modifications made. Non-disclosure could lead to rejected claims.
- Report claims immediately to the Ibiliti claims team. within a time-frame of 30 days.
Key Takeaways
Excess Cover saves your commercial clients thousands, helping them keep their cash predictable when accidents happen.
Basic Excess Cover:
- Can only respond if your client has a valid claim and the Main Insurer (Underlying Insurer) pays the claim and calls for the excess to be paid.
- Does not waive the entire excess. Your client still pays a much smaller “inner excess”, just a fraction of what they would pay otherwise.
You’ve got this!
Understanding products like Basic Excess Cover sets you apart as a forward-thinking advisor.
Author: Yolande van Niekerk
Published by: © Ibiliti Risk Solutions FSP43404 on the 10th September 2025
Insured by Old Mutual Alternative Risk Transfer Insure Limited Ltd T/A OMART Insure, a licensed Non-Life Insurer and authorised FSP.
