Avoiding NCD loss on car insurance

eDicky

Following a minor rear-end collision (obviously my fault) at some traffic lights, I requested the other driver to price his repair and let me know so that I could pay him personally and avoid involving insurance and loss of no claims discount. I have the cheapest cover with high excess and no NCD loss cover, never having claimed in fifty years.

He readily agreed, took my contact and insurance details, and we departed. Unfortunately I was called away overseas a few days later, so could not attend to his letter containing the repair estimate, and his two or three calls to my mobile were from a withheld number which I never answer when roaming. After nearly two weeks he decided to report it to the insurance and when I was finally able to contact him the next day he had already registered a claim. I contacted my own insurance for advice, and registered a 'notification' of the incident but not a claim. He is now going to contact his insurance company again today (Monday) to see if he can have the claim withdrawn and we both return to the original private arrangement.

So my questions are, is it possible to have such a claim withdrawn once it is initiated, and would I lose my no-claims anyway even if it is withdrawn, since such notification of the incident is already given?

Both I and the other driver have no experience whatever in such matters, which is probably apparent. Any advice will be much appreciated, including scathing comments if deserved - many thanks in advance.

Quentin

Whatever happens you won't lose your no claims bonus if you pay for all the costs yourself (either directly or by reimbursing your insurer any outlay they have to make)


The third party can cancel his claim (though costs may already have been incurred by his insurer in which case they would need reimbursing to avoid the third party losing any no claim bonus


But now that the insurers know about the incident then your (and the third party's) "no claims" history cannot be reinstated, and you will have the incident on your record which will have to be disclosed when getting quotes in the future. (Insurers require details of all incidents, not just actual "claims")

eDicky

Thanks for that Quentin! So if I pay all costs, including any incurred by his insurer up to the claim cancellation, neither of us will lose our no claims bonus. But the incident will remain as part of our claims history, and perhaps affect the cost of future quotes? Does that expire after a certain number of years?

forgotmyname

It expires when the insurers stop asking for that info, mostly 5 years but some are as little as 3 years.

In 3 years+ time though a company that only ask for the last 3 years (so no need to inform them) may not be cheaper than a company that asks for 5 years and still need to be informed of the incident.

His repair costs maybe a lot more than you may think. Costs of repair + hire car charges etc?

eDicky

forgotmyname wrote: »

It expires when the insurers stop asking for that info, mostly 5 years but some are as little as 3 years.

In 3 years+ time though a company that only ask for the last 3 years (so no need to inform them) may not be cheaper than a company that asks for 5 years and still need to be informed of the incident.

His repair costs maybe a lot more than you may think. Costs of repair + hire car charges etc?

Thanks for the info, so it's similar to declaring traffic offences (I'm not so new to that).

I had not thought of hire car cost, no mention on the repair estimate he sent me, £656, may include courtesy car. My excess is £350 on an annual premium of about £220. I am not sure what that would jump to without NCD...

Quentin

eDicky wrote: »

.... My excess is £350 on an annual premium of about £220. I am not sure what that would jump to without NCD...

You do know that you wouldn't have to pay any excess if you just let this go through as a claim??


(You can get a good idea of what the premium will be if you let your insurer pay by doing dummy quotes now online, with the claim (as a "full" claim) and reduce your NCD, and with the claim (just as an incident with no cost) and your full NCD)


Find out the premium difference and do the sums to see if it is really cost effective to pay out yourself. (Are you sure the price you have had is for the full job and includes VAT as well as paint/parts etc)

eDicky

Quentin wrote: »

You do know that you wouldn't have to pay any excess if you just let this go through as a claim??

No, I didn't know. I've always understood that the excess amount on an insurance policy is the amount payable by the insured in the case of a claim. Is that not so in this case for some reason?

eDicky

Quentin wrote: »

(You can get a good idea of what the premium will be if you let your insurer pay by doing dummy quotes now online, with the claim (as a "full" claim) and reduce your NCD, and with the claim (just as an incident with no cost) and your full NCD)

Find out the premium difference and do the sums to see if it is really cost effective to pay out yourself. (Are you sure the price you have had is for the full job and includes VAT as well as paint/parts etc)

Yes, the quote is for the full job, parts, labour, VAT etc.

I have been going on the assumption that maximum no claims gives about 60% discount, which it may have been at one time but is no doubt less simple these days. I will try to find time tomorrow to check in the way you suggest, it's my bedtime now here in Singapore.

I have just spoken by phone to the third party, Mr B, a very decent and considerate gent - he has put the claim on hold with his insurance company (who have not mentioned any expenses incurred already), and is now awaiting my decision on the best moneysaving course for me. He thinks the repair shop do not provide a free courtesy car, but that there would be one on the insurance. He says his wife would have to pay about £20 in bus fares for two days during the repairs, but I think I should at least offer to pay for a rental car.

Anyway, now I have a day or two to consider. All advice is welcome and much appreciated!

forgotmyname

If you dont claim for yours there is usually no excess.

As they already know about it i would just leave them to it now. Just may need a bit more shopping around next year.

Quentin

eDicky wrote: »

No, I didn't know. I've always understood that the excess amount on an insurance policy is the amount payable by the insured in the case of a claim. Is that not so in this case for some reason?

It is the case, though it depends on what part of the policy you are using for a claim.


In your case (assuming you don't claim for your own repairs) then you will be using your third party section which doesn't have any excess to pay.


So if you decide to let your insurer deal with this you won't have to pay a penny as far as the claim is concerned (your insurer will also pay all the associated expenses the third party is put to eg, any hire car needed/bus fares etc)


If you were to get your car repaired via your insurer then that would all come as part of the claim (ie you would just have one claim covering the repairs to both cars, though you would have to pay your excess and any uninsured losses like car hire would be your own responsibility (though usually you get a free courtesy car whilst yours is being repaired).

eDicky

This morning I did a comparison using the Google site. The cheapest with 21years' no claims and with the incident declared at zero claim cost was £205, and the cheapest with zero no claims discount and £800 claim cost was £540, a difference of £335 for the first year which will presumably decrease over successive years. A completely different range of insurers was shown.

Mr B requires me to pay him £686 to cover repairs and bus fare (although I feel I should add another £20 for goodwill and possible car hire), in order for him not to proceed with the claim.

So the difference in cost to me, between paying him directly and the increased insurance costs over the next few years, is probably minimal and uncertain, unless anyone can (most likely) foresee better than I. I can send him a faster payment by internet banking today for him to receive tomorrow.

I am undecided - what should I do..?