Car insurance excess explained (New Zealand)

Do I pay an excess on every claim?

On almost every claim, yes. Consumer Protection's position is that apart from some windscreen cover, you pay an excess whichever policy or cover type you hold. It is the amount you pay towards your own claim, and it is deducted from what the insurer pays out rather than billed to you separately.

Consumer Protection, which is part of the Ministry of Business, Innovation and Employment, states the general position:

“Apart from some windscreen cover, you will pay an excess no matter which policy or cover type you have.”

— Consumer Protection (MBIE), Car insurance, read 2026-09-16

What is the standard car insurance excess in NZ?

There is no single figure, and seven of the eight insurers on this site publish none at all. They say the amount is on your own policy schedule, because it depends on the car, the drivers and what you chose. State is the exception and publishes a standard excess with a definition of what it covers.

This is the finding that surprised us most while building this page. Of the eight insurers on this site, seven publish no standard excess at all. They say, correctly, that the figure is on your own schedule — because it depends on the car, the drivers and what you chose. AA Insurance puts it this way:

“Your policy schedule contains important information related to this policy document, including who's insured, your cover type, your agreed value and excesses.”

— AA Insurance, Comprehensive Car Insurance Policy (updated April 2025), read 2026-09-16

State is the exception, and publishes both a figure and a definition of what the figure means:

“Standard car excess refers to a publicly available default vehicle excess that direct insurers use to provide an initial quote… The lowered excesses apply to new State car policies quoted on or after 17 May 2026.”

— State, Car Insurance, read 2026-09-16

What additional excesses can be added on top?

The standard excess is the floor, not the total. Vero's MotorPlan wording names six further kinds that can sit on top of it: an imposed excess, an international excess, an unnamed driver excess, a new driver excess, an underage excess and a special excess. They add together on a single claim.

Vero's MotorPlan wording names them:

“Types of additional excesses that could apply … Imposed excess … International excess … Unnamed driver excess … New driver excess … Underage excess … Special excess”

— Vero, MotorPlan Policy (effective 1 December 2025), read 2026-09-16

Young and inexperienced drivers

Every insurer on this site treats a young or inexperienced driver as a higher risk, but they do it in three different ways: a higher excess, an optional exclusion, or a flat refusal to cover the driver. Only two publish anything numeric.

Cove's wording is worth quoting in full, because it is the only one in this market we found that puts numbers on a public page:

“the inexperienced driver excess being the higher of: $500 if at the time of the loss or accident the insured person is aged between 21 and 24 (inclusive), or $1,000 if at the time of the loss or accident the insured person does not hold a full current New Zealand driver licence.”

— Cove Insurance, Car Insurance Policy Wording CoveCar082025, read 2026-09-16

Glass

Windscreens are the one place where an excess sometimes disappears — and the one place where a specific excess is sometimes published. Vero states both halves of it:

“If your windscreen or window glass is repairable, you won't have to pay an excess. • If your windscreen or window glass needs replacing, you'll need to pay a $500 excess.”

— Vero, MotorPlan Policy (effective 1 December 2025), read 2026-09-16

Several insurers sell an optional benefit that removes the glass excess. Tower's version is automatic cover with an optional excess buy-out, and its wording is specific about what the buy-out does not extend to: “This benefit does not cover sunroofs, panoramic roofs, mirrors, lights, indicators or their covers.”

Unnamed drivers

If your policy names drivers and somebody else drives, two different things can happen depending on the wording: an extra excess, or a declined claim. Consumer Protection is blunt about the second:

“If you name drivers on your policy, be careful not to let anyone other than named drivers use your car. If you do and they have an accident, your insurer is unlikely to honour your claim.”

— Consumer Protection (MBIE), Car insurance, read 2026-09-16

Can I reduce my excess?

One insurer of the eight publishes a way. AMI offers a short online safe driver course and states it saves $250 off the excess you would pay on a claim. It is the only mechanism of that kind we found published among the eight, so on the rest the excess is set when you buy.

AMI publishes a course that reduces the excess you would pay on a claim: “Take our short AMI Safe Driver online course and save $250 off your excess if you make a claim.” It is the only mechanism of this kind we found published among the eight.

What should I ask about the excess?

1. What is my standard excess on this quote, in dollars?
2. Which additional excesses could apply to me, and what is each one?
3. Does an additional excess apply to a theft claim, or only to an at-fault crash? At least one insurer publishes that its extra driver excesses do not apply to theft or malicious damage claims.
4. If I raise the excess, how much does the premium drop — and could I actually pay the higher excess tomorrow?