Car Insurance No Claims Confusion, Please Help

chrisc156

Hi

This is my first post on here but I felt it necessary to ask about this is it's driving me nuts.

As of this time last year I had earned according to Tesco renewal document 6 years of no claims discount. I then decided to move to More Than because it was cheaper !

3 weeks after the purchase of a brand new car in May this year the car was stolen!. Now I did not have the policy protected but I thought ok I will lose a couple of years at most, so in my estimation I would have 4 years left.

I have in the last few days received my renewal document through from More Than and was shocked to find that I have been reduced to 2 years with a corresponding jump in the price of my policy.

I decided to query this with More Than and managed to speak to someone in the claims department, all they kept repeating was that they only count 4 years as their maximum discount and I had been reduced from this.

They also confirmed that this would be the figure (2 years) that would be carried forward to another insurance company which I WILL be moving to following the appalling service I received from More Than following the theft claim of my car.

How is this fair, surely if I started with 6 years then it is this figure that should be assessed for my no claims and not the 4 years that More Than quotes for its maximum discount?

Is there anything I can do about this ie get the figure increased or prove to another insurance company that I should have more ?

The whole no claims years figure is really confusing me now, I mean how do people end up with 10 years NCD and what would they have ended up with after a claim. I have never made a single claim in nearly 15 years of driving !

Please, please can someone give me any incite into what has happened and wether it is reasonable or not.

Many Thanks
Christian

MarkyMarkD

There are two different things going on with no claims discount.

Firstly, there's the number of years you have not claimed. This can go from 0 to (theoretically) 80 or so! Mine is currently over 15 years as was yours.

Secondly, there's the percentage no claims discount you are allowed by your insurer. This is calculated by them based on their specific algorithm, but normally something like

1 year = 30%
2 years = 40%
3 years = 50%
4 years = 60%

So, having 4 years or 15 is academic for an insurer like this - you will STILL only get 60% no claims discount.

When a claim happens, you ALWAYS (with all insurers, irrespective of their scale of NCD) lose two years worth of discount on their scale. This means that you go from 4 years to 2 years i.e. from 60% to 40%, and on a subsequent claim in the same year, from 40% to 0%.

Switching to another insurer, once the claim has happened, isn't going to help you - you will be shown as having 2 years NCD and almost every insurer will count that as 2 years. They will also load your premium for your claim, so you get stuffed both ways.

The major exception to this principle is esure (who I happen to be insured with). The difference is that their scale goes up to 75%, at a rate of 1% extra per year you stay with them. Even if you start with 15 years NCD, they will only give you 70%, but you get more for every subsequent year of insurance with them. In exchange for this generosity, you lose THREE (rather than TWO) steps in the NCD ladder for each claim.

But to compare them:

Normal insurer - 60% before claim (max), 40% after claim, 0% after 2 claims in same year
esure - 75% before claim (max), 72% after claim, 65% after 2 claims in same year, 45% after 3 claims in same year, 0% after 4 claims in same year.

There's no point paying for NCD protection with esure, IMHO, because you lose so little if you do actually claim.


In conclusion, what more than are doing is right. But there are better choices out there for your future consideration.

chrisc156

Thanks alot MarkyMarkD for posting the detailed reply to my question, sounds like there's not much I can do about this then.

One final quick question so I don't get stung in the future, if you manage to carry 6 years ncd to More Than and did not make a claim would they still class you as having 4 years ncd which is their maximum if you were to switch after a year ?

Many Thanks
Christian

MarkyMarkD

Yes, but if you moved to an insurer which recognised more than 4 years then you could produce a copy of the renewal notice showing 6 years, as well as your more than renewal notice, as evidence that you actually (now) had 7 years. I've done this in the past when I could be bothered.

I would ALWAYS state the correct number of years when applying for a quote - i.e. say 7 years, if that's what you actually have. It's then up to them to query it, and you to prove it, if they do challenge you on the number of years compared to your renewal notice.