Caravan Insurance Excess Explained

Caravan insurance excess is the fixed amount you contribute to any claim before your insurer pays the rest. If a storm tears apart your awning and repairs cost $3,000, and your excess is $500, you pay $500 and your insurer covers $2,500. Understanding how excess works — and how different excess types can stack — means no nasty surprises when you need to claim.

What Is Caravan Insurance Excess?

Every caravan insurance policy has at least one type of excess. Think of it as your skin in the game. Insurers use it to discourage small, frequent claims and to share the financial risk with you.

The excess is deducted from your claim payout. So if repairs cost $1,200 and your total excess is $600, you get $600 from your insurer. If the repair bill comes in below your excess amount, your insurer pays nothing and the claim is pointless to make.

This applies across all recreational vehicle types: caravan, motorhome, camper trailer, fifth wheeler, pop-top — the excess mechanics are the same regardless of what you tow or drive.

What Are the Different Types of Excess?

Most people expect one excess figure. In practice, several types can apply simultaneously, and they add together on a single claim.

Basic Excess

This is the foundation. Every policy has one. It is the minimum amount you pay on any claim. Typical basic excesses for caravans and motorhomes in Australia sit between $300 and $800, though higher-value rigs often carry higher base amounts.

You usually have some say over this figure. Most insurers let you nominate a higher basic excess in exchange for a lower annual premium — this is sometimes called a voluntary excess.

Voluntary Excess

A voluntary excess is an amount you choose to add on top of the basic excess. By taking on more financial risk, you signal to the insurer that you are less likely to make small claims. In return, they reduce your premium.

Example: You have a basic excess of $400. You agree to a voluntary excess of $300. Your total excess on any claim is now $700 — but your annual premium drops by, say, $120. If you go three years without claiming, you are ahead by $360. Claim once in that period and you have effectively paid more overall.

The maths matters. Run the numbers for your own situation before automatically opting for the highest voluntary excess available.

Age Excess

If the person towing your caravan or driving your motorhome is under 25, an age excess applies on top of the basic excess. Typical amounts:

• Driver aged 16–20: additional $500 excess
• Driver aged 21–24: additional $300 excess

This applies even if you are the policyholder. If your adult child takes your camper trailer on a trip and they are 22, expect the age excess to kick in on any claim related to that trip.

Inexperienced Driver Excess

This one catches people off guard. If anyone towing or driving is over 25 but has held their licence for less than two years, an inexperienced driver excess applies — typically around $400. Age is not the only factor; experience is.

Off-Road Excess

Many policies cover off-road use under specific conditions, but add an extra excess for it. If you take your caravan or camper trailer on a beach, unsealed road, or track, expect an additional $200–$500 excess on any claim arising from that trip. Always check your PDS before heading off the bitumen — some policies exclude off-road entirely rather than adding an excess.

Hire-Use Excess

If you rent out your caravan or motorhome to others, a higher excess applies. This is on top of your standard basic excess. The insurer is taking on more risk because an unknown driver is now using the vehicle.

Transportation Excess

Some policies include optional cover for when your rig is transported by road, rail, or sea. If they do, a separate transportation excess applies to any claims under that cover.

When You Do Not Have to Pay Excess

You might not pay any excess at all in two scenarios.

First, if the incident is entirely the fault of a third party and you can provide their name, address, and vehicle registration, most insurers will waive your excess. They pursue the other party to recover costs. No third-party details usually means you are back to paying the standard excess while the claim is processed.

Second, some insurers offer specific excess-free benefits. KT Insurance, for example, covers glass repairs up to $500 with no excess if the glass is legally repairable. Some policies also include excess-free towing cover up to $1,000. These are worth checking for in the policy schedule — they can save you real money on minor incidents.

How Excess Types Stack on a Single Claim

This is where people often get a shock. Multiple excess types apply together, not instead of each other.

Say your 22-year-old daughter is driving your motorhome and takes it on an unsealed access road when a tree branch falls on the roof. You might face:

• Basic excess: $500
• Age excess (21–24): $300
• Off-road excess: $300
• Total: $1,100

The repair bill would need to comfortably exceed $1,100 before the claim is worth making. Always check your PDS to understand which excess types can stack — and plan accordingly.

Choosing the Right Excess Amount

Higher excess equals lower premium. That is the basic trade-off. The question is whether it makes financial sense for your situation.

A useful way to frame it: how many claim-free years do you need before the premium saving offsets the higher excess?

If raising your excess from $500 to $1,000 saves you $150 per year in premium, you need to go three to four claim-free years to come out ahead. Make one claim during that period and you have paid more than you saved.

Questions to ask yourself before choosing a higher excess:

• Can I comfortably pay this amount at short notice if I need to?
• How often have I claimed on vehicle or recreational vehicle policies in the last five years?
• Am I towing in challenging conditions — remote areas, rough roads, heavy traffic — where the claim risk is higher?
• Does a younger or inexperienced driver ever use the rig? If so, stacking excesses will push the real total much higher.

For most people, a mid-range excess — enough to show you are not going to claim for every scratch but not so high that a single minor incident becomes crippling — is the right call. Think $500–$700 for a standard touring caravan or camper trailer, $700–$1,000 for a high-value fifth wheeler or motorhome.

Can You Reduce Your Excess with Add-Ons?

Some insurers offer optional extras that modify how excess works. Common ones include:

• No excess for glass damage: Covers windscreen or window damage without applying the basic excess. Common on motorhome and campervan policies.
• Reduced excess for theft: Some specialty caravan insurers offer lower excess on theft claims if you have approved security devices fitted.
• Excess buydown: Pay a slightly higher premium to reduce the standard basic excess to a lower nominated figure.

These add-ons cost something, so run the same breakeven calculation. If you travel in a hailstone-prone state like Queensland or are frequently on outback roads with high windscreen risk, the no-excess glass option is often worth the few extra dollars per year.

Frequently Asked Questions

This article is general advice only and does not account for your personal circumstances. Always read the Product Disclosure Statement before purchasing any insurance product.

— The team at Compare Caravan Insurance