WARNING Car Insurance No Claims Discount - Theft?

chrisholt8138

I don't know how many people have discovered this but please be WARNED about this before you renew your car insurance.

Last year I had 11 years NCD when I renewed my policy, I had an accident that was my fault. It is now due for renewal and my NCD has been knocked back to 3 years:mad:. Which means I have lost 8 years NCD for 1 accident.
When I queried this with my insurer they said that although I had 11 years NCD; their maximum was 5 years, thus they have to knock it back to 3 years. !!!!!
I have contacted a number of other insurers who say this is not uncommon and they sympathise but can't/won't do anything other than accept my proof of NCD at 3 years.
These companies all recognise at least 7 years NCD as their maximum so far I have only found mine, Swiftcover, that is so low. It seems to me that Swift have taken away from me a significant number of years of NCD for which I have worked hard to earn with other insurance companies and which I have no longer have the financial benefit I had earned. This to me seems tantamount to theft of my rights and privileges.
It was never made clear to me by Swift that this was the case, before I took out the policy, otherwise I would certainly have looked around for another company.
Please be aware that this is a current practice being used by insurance companies and YOU could loose out significantly.

Hope I save some of you guys the pain of this.

Quentin

What you have experienced is the norm.

No matter how many years you go without making a claim, if you have unprotected NCD and make a claim that you are deemed in any way at fault, or even not at fault but the insurer has been unable to reclaim all its costs, then your level of NCD at remewal will be 3 years.

It was never made clear to me by Swift that this was the case, before I took out the policy, otherwise I would certainly have looked around for another company.

They (like all companies) very clearly set out what happens to your NCD in the policy:

See Section H: http://www.swiftcover.com/carinsurance/policy/no-claims-discount/

newbie007_2

I'm aware of this.....didnt you know to protect your NCD for usually 10% extra fee on top of the premium?

chrisholt8138

Thanks Quentin, but I have to disagree. Speaking to 3 other companies today, they said they would only knock back my NCD by 2 or 3 years for 1 accident thus if their maximum was 9 years (most are) then I would still have 6 or 7 years NCD. This has also been my experience in the past.
Thanks for the link to Swiftcovers' page on this, I now see that it is their terms, but I still say its unfair for them to be so aggressive in their policy on maximum NCD accepted. As this is so key to future policy prices, it should be made very clear when you take out their cover. Thanks again for taking time to add your comments.

chrisholt8138

Thanks for your reply newbie007,
for financial reasons I elected to take the risk of loosing some NCD if I had an accident. OK fair enough the gamble didn't pay off, I accept that but I still don't feel that Swifcovers terms on this are fair, they certainly are not compared to a number of other insurers I have spoken to, who wouldn't be so aggressive in their terms on NCD. Cheers

pborojon

chrisholt8138 wrote: »

Thanks for your reply newbie007,
for financial reasons I elected to take the risk of loosing some NCD if I had an accident. OK fair enough the gamble didn't pay off, I accept that but I still don't feel that Swifcovers terms on this are fair, they certainly are not compared to a number of other insurers I have spoken to, who wouldn't be so aggressive in their terms on NCD. Cheers

Who are these other companies you have spoken too?

Quentin

chrisholt8138 wrote: »

Thanks Quentin, but I have to disagree. Speaking to 3 other companies today, they said they would only knock back my NCD by 2 or 3 years for 1 accident thus if their maximum was 9 years (most are) then I would still have 6 or 7 years NCD.

Whoever you have spoken to has mislead you. The two years they say they will knock off is correct, but they neglected to point out to you that it would be knocked off 5 as the maximum level. (Check their policies if you feel you cannot accept this advice)

The max "high" for the sliding scale (downwards) after claiming is 5 years.

Some companies give small additional discounts for having more than 5 years, but that is when you buy the policy. If you subsequently make one claim, then at renewal you will have 3 years.

2010

I too have recently noticed yet another scam by these insurance companies.
I was with Direct line for years and built up 9 years NCD.
When I switched to another insurer, on the 12 month renewal,I noticed they only gave me 6 years.
When I queried this, I was told that 6 years is their maximum.
Last year I switched to the Co-op and had to send proof of NCD (6 years).
Having just received my renewal they have still only given 6 years, despite having been with them a year.

So it seems if you are loyal and stick with one company you can build up say 10 years NCD but if you switch to someone else they will only give you their maximum of 6,thus losing you 4 years NCD.

Another not so obvious scam.

pborojon

2010 wrote: »

I too have recently noticed yet another scam by these insurance companies.
I was with Direct line for years and built up 9 years NCD.
When I switched to another insurer, on the 12 month renewal,I noticed they only gave me 6 years.
When I queried this, I was told that 6 years is their maximum.
Last year I switched to the Co-op and had to send proof of NCD (6 years).
Having just received my renewal they have still only given 6 years, despite having been with them a year.

So it seems if you are loyal and stick with one company you can build up say 10 years NCD but if you switch to someone else they will only give you their maximum of 6,thus losing you 4 years NCD.

Another not so obvious scam.

How exactly is it a scam? How have you been conned?

bouncydog1

It isn't a scam - many people are of the belief that the more years you are claim free the more discount you have - if that was the case you would end up with a premium of nil!!

The maximum discount is usually based on 65% (equal to 5 years) - some insurers will go up to 70%. In the event of a claim their starting point for a maximum bonus is 5 years which knocks back to 3.

Clearly defined in the policy wordings (which more and more people aren't reading because they are attracted by the bargain price they have bought their insurance for).

Moral of the story - read the wordings before you buy so that you end up with the product you want, not what you think you should have.

mattymoo

2010 - any NCD earned over and above 5 or 6 years is a marketing tool. The general motor insurance market does not recognise those levels of discount so you only get to keep them while you stay with the insurer that offered you it.

The scale goes something like this.
1 yr = 30%
2 yr = 40%
3 yr = 50%
4 yr = 60%
5 yr = 65%

This is where most insurers stop.

6 yr = 67%
7 yr = 69%
8 yr = 72%
9 yr = 75%

However, if the base premium is higher to begin with, the extra 10% discount may not be worth it.
e.g. base premium = £1600 less 75% = £400
base premium = £1000 less 65% = £350.

So don't get too hung up on the loss of NCD when switching between those that do recognise 9yrs and those that recognise only 5.