Why You Should Get Excess Buyback

Have you ever wondered if you should get excess buyback with your car insurance policy? In our last article, we talked about my car being vandalized while being towed to the mechanic’s shop. The damage to the vehicle was so severe it took 2 weeks to repair.

Throughout that two weeks, the insurance company provided me with a similar car to the one I drive. In addition, they provided me with a driver. The driver picked me up every morning and took me to work. Then he parked in my office premises and took me wherever I needed to go to during the day. If I had no where to go, the driver stayed at office premises. He then would take me home when I was ready to go home.

This was at the height of the Lagos traffic, when it took us 2 hours to go from my office to my house, even though the distance between my house and my office is about 6 kilometres (about 4 miles) apart. If I had rented a car for 24 hours a day, it would probably cost me at least N5,000 per day. Furthermore, I would have had to pay the driver at least N5,000 per day.

For 10 working days, I would have paid N100,000. In addition, it cost N250,000 to repair my car. So, if you add both costs, then we are looking at N350,000.00 to fix my car.

Because I have excess buyback, I paid nothing after the accident. The excess buyback cost me 1% of the value of my car (N30,000.00).

If I didn’t have excess buy back, then I would have had to pay 10% of the cost which is N35,000.00. This means that by buying excess buyback, I have saved N5,000 upfront, and I won’t have to pay anything for any subsequent accident claims. If I didn’t have excess buy back, then every subsequent accidents, I would have to pay 10% of the cost to repair the car again. This is the reason why you should get excess buyback with your insurance policy.

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