What is no claims bonus?
No claims bonus is a discount applied to your insurance premium which increases each year providing you have not had any claims in that policy term. Insurers generally give a maximum discount of 50%-70% and increase the discount for up to 5 years, although some insurers will keep increasing the discount for up to 13 years!
What is no claims bonus protection?
Usually when you make a claim against your insurance policy, some or all of any no claims bonus that you have spent years accruing can be lost immediately. This doesn’t only happen in claims that are your fault! Normally an insurer will step back your no claims bonus as soon as an incident has happened and will not reinstate it until the incident has been settled in your favour and a full recovery made from someone else.
Why should I protect my no claims bonus?
Protecting your no claims bonus would ensure that the discounts that you have earned over the years are not lost in the event of a claim. Protection normally allows the policyholder to make 2 fault claims in any 5 year period without any loss of the discounts given, however some insurers will allow more. It also means your no claims bonus will not be stepped back whilst a claim on your policy is settled!
Does this mean I’ll never be penalised for making a claim?
Unfortunately not! Whilst the no claims bonus protection will allow you to keep this particular discount, insurers are likely to load for an adverse claims history – the size of the load being dependant on the value, circumstances and frequency of the claims. No claims bonus protection would mean that the impact of a fault claim on your policy would have a much smaller impact on the renewal premium or premiums offered by any other insurers.
How much does it cost to protect my no claims bonus?
Each insurer has a different pricing plan for the protection so it is worth giving us a call on 01253 764294 to find out more.