The excess is the proportion of the insurance you could be liable for should the unfortunate happen, these are found in most types of insurance including both typical household and car insurance policies.
When using a rental vehicle, the car hire provider has their own insurance policies to cover damages. On picking up a vehicle they will charge / preauthorise a deposit from the lead driver which covers the excess costs should the vehicle be damaged. They will offer their own form of excess waiver products or “upgraded” insurance at the rental desks.
When you purchase a car hire excess policy you are protecting yourself against the potential cost of this excess by means of an excess reimbursement process. It is designed to repay you the amount of any excess or repair costs that you are required to pay under the terms of the rental agreement (up to any policy limit in place) following any damage to the rental vehicle.