Insurance no claims relationships

Mickey666

Sandtree said:

You have 2.5 separate concepts....

1) Claims history -  what it says on the tin, pure and simple is any claims (or incidents) in relation to a motor vehicle where you were the driver or policyholder. Its the simplest concept and is universal.

1.5) Insurance history - simply how many continuous years you have held insurance for... not a common question on Motor but fairly common on Home where NCD is a less developed concept.

2) NCD/NCB - is an artificial construct and exact rules vary between insurance companies. Some are fully transferable and others are designed to be hard to transfer. This in theory could be seen as a combination of claims history and insurance history but its not as it is complicated with factors like Protected NCD and Fault -v- Non-fault claims.

Think of NCD as a discount card or a physical thing... you can only give it to one policy at a time and some insurers will only accept it if its for the same vehicle class (car, van, bike) whereas others will accept cross class. Its increase/decrease is linked purely to the policy on which it is currently being used so a claim on another policy wont decrease the others.

Get a second vehicle for the first time? Your NCD is already on another policy so you have to start a new one. Similarly decide to go back down to one vehicle and there is no way to combine the two together or handing over both to the next insurer.

Were the discount not so substantial or if the majority of people didnt have 4+ years I would be much keener on the NCB name as its a "bonus".

No.  Your NCD, or at least the risk, relates to the DRIVER, not the new car.  No need for a new policy, just add the new car to the existing policy.  Yes, I know that’s not how it currently works but it could so easily be changed.  A driver might might own two, three, 100 cars but they can only drive ONE of them at a time!  The DRIVER is the risk being insured, not the car!

Mickey666

Aretnap said:

Mickey666 said:

Alenka81 said:

Hi all
Hope someone has a bit of experience in this topic and can maybe advise...
I have a motorcycle, car and van insurance. When talking about no claims bonus, these don't seem to relate, i.e.my 13 years of no claims on the car doesn't apply to my motorcycle insurance, however they apply any claims on the car to calculate my premium. Now is this doesn't sit right with me and I feel ripped off. 
Any ideas anyone please?

It doesn’t sit right with me either, though I know this is how NCD works.
I’ve never heard any justification that seems fair and reasonable for this rule.  After all a CAR cannot accrue NCD, it is all down to the DRIVER, so who cares what vehicle the driver is driving (as long as they are insured for it, obviously).
Yet, while insurance companies disallow a driver-based NCD, they are quick to recognise driver-based accident claims, even in cases of no-fault accidents.  Of course, NCD can be protected but that costs extra as well.
So, I can wholeheartedly understand the OP feeling being ripped off, even though it’s standard industry practice.

NCD is a marketing gimmick. Nothing more, nothing less. If you want a "justification" for it, you're coming at it from the wrong angle. 

In the distant past it was a form of loyalty bonus, a way for insurers to encourage their customers (especially the good ones who didn't make claims) to stick with them year after year, and the intention was that you would only get it if you stayed loyal.

Well, of course that went the way of all loyalty bonuses. Insurers realised that if they wanted to attract customers from their rivals, they would have to offer to match their NCDs. A bit like Sainsbury's might offer to accept Tesco's money off vouchers - not because they're under any moral or legal obligation to accept them, but just because it's a good way to poach Tesco customers. 

Viewed from that angle most of the oddities make sense. If you're insuring a second car for the first time then you don't have an existing insurer offering you a loyalty discount for that car - so there's no incentive for any other insurer to offer you one either. And complaining that you can't use your discount on two policies at once is a bit like getting a £20 off your next shop voucher from Tesco, then complaining that you can't use it twice at two different supermarkets. 

In practice of course NCD has been rather uncomfortably crowbarred into insurers' general rating systems. I suppose it might be better if it was scrapped altogether, but it's too late. Too many people see their NCD as (a) a basic human right and (b) the most valuable thing they'll ever own (you can even get insurance for it!) so the first insurer to scrap it and move to an alternative system would immediately lose all their customers. But of course it's neither a human right not the most valuable thing you'll ever own - it's just a marketing gimmick that got out of hand. 

I don’t think anyone has suggested scrapping NCD, just apply it to the driver and not the car.  NCD as a concept seems perfectly fine - no accidents means lower risk means lower premiums.  Perfectly sensible.  What is not sensible is applying it to an inanimate vehicle instead of the actual driver.  But of course, insurance companies are In business to make money, not necessarily to be sensible.

Car_54

Mickey666 said:

Sandtree said:

You have 2.5 separate concepts....

1) Claims history -  what it says on the tin, pure and simple is any claims (or incidents) in relation to a motor vehicle where you were the driver or policyholder. Its the simplest concept and is universal.

1.5) Insurance history - simply how many continuous years you have held insurance for... not a common question on Motor but fairly common on Home where NCD is a less developed concept.

2) NCD/NCB - is an artificial construct and exact rules vary between insurance companies. Some are fully transferable and others are designed to be hard to transfer. This in theory could be seen as a combination of claims history and insurance history but its not as it is complicated with factors like Protected NCD and Fault -v- Non-fault claims.

Think of NCD as a discount card or a physical thing... you can only give it to one policy at a time and some insurers will only accept it if its for the same vehicle class (car, van, bike) whereas others will accept cross class. Its increase/decrease is linked purely to the policy on which it is currently being used so a claim on another policy wont decrease the others.

Get a second vehicle for the first time? Your NCD is already on another policy so you have to start a new one. Similarly decide to go back down to one vehicle and there is no way to combine the two together or handing over both to the next insurer.

Were the discount not so substantial or if the majority of people didnt have 4+ years I would be much keener on the NCB name as its a "bonus".

No.  Your NCD, or at least the risk, relates to the DRIVER, not the new car.  No need for a new policy, just add the new car to the existing policy.  Yes, I know that’s not how it currently works but it could so easily be changed.  A driver might might own two, three, 100 cars but they can only drive ONE of them at a time!  The DRIVER is the risk being insured, not the car!

NCD is nothing to do with risk, it is a reward for making no claims.

You could have had a dozen no-fault accidents but retain your NCD. You would, however, be viewed as a poor risk.

neilmcl

Mickey666 said:

neilmcl said:

nottsphil said:

neilmcl said:

That's simply just the way it is and always been.

That comment neither explains it nor justifies it. 

It doesn't need to be justified, it's just the way things are and nothing is likely to change.

Of course nothing is likely to change with that sort of defeatist thinking, but how many times has consumer pressure resulted in a change to commercial practices.  Hasn’t MSE itself instigated many changes itself as a consumer champion?

Have at it 🤣

Car_54

Mickey666 said:

Aretnap said:

Mickey666 said:

Alenka81 said:

Hi all
Hope someone has a bit of experience in this topic and can maybe advise...
I have a motorcycle, car and van insurance. When talking about no claims bonus, these don't seem to relate, i.e.my 13 years of no claims on the car doesn't apply to my motorcycle insurance, however they apply any claims on the car to calculate my premium. Now is this doesn't sit right with me and I feel ripped off. 
Any ideas anyone please?

It doesn’t sit right with me either, though I know this is how NCD works.
I’ve never heard any justification that seems fair and reasonable for this rule.  After all a CAR cannot accrue NCD, it is all down to the DRIVER, so who cares what vehicle the driver is driving (as long as they are insured for it, obviously).
Yet, while insurance companies disallow a driver-based NCD, they are quick to recognise driver-based accident claims, even in cases of no-fault accidents.  Of course, NCD can be protected but that costs extra as well.
So, I can wholeheartedly understand the OP feeling being ripped off, even though it’s standard industry practice.

NCD is a marketing gimmick. Nothing more, nothing less. If you want a "justification" for it, you're coming at it from the wrong angle. 

In the distant past it was a form of loyalty bonus, a way for insurers to encourage their customers (especially the good ones who didn't make claims) to stick with them year after year, and the intention was that you would only get it if you stayed loyal.

Well, of course that went the way of all loyalty bonuses. Insurers realised that if they wanted to attract customers from their rivals, they would have to offer to match their NCDs. A bit like Sainsbury's might offer to accept Tesco's money off vouchers - not because they're under any moral or legal obligation to accept them, but just because it's a good way to poach Tesco customers. 

Viewed from that angle most of the oddities make sense. If you're insuring a second car for the first time then you don't have an existing insurer offering you a loyalty discount for that car - so there's no incentive for any other insurer to offer you one either. And complaining that you can't use your discount on two policies at once is a bit like getting a £20 off your next shop voucher from Tesco, then complaining that you can't use it twice at two different supermarkets. 

In practice of course NCD has been rather uncomfortably crowbarred into insurers' general rating systems. I suppose it might be better if it was scrapped altogether, but it's too late. Too many people see their NCD as (a) a basic human right and (b) the most valuable thing they'll ever own (you can even get insurance for it!) so the first insurer to scrap it and move to an alternative system would immediately lose all their customers. But of course it's neither a human right not the most valuable thing you'll ever own - it's just a marketing gimmick that got out of hand. 

I don’t think anyone has suggested scrapping NCD, just apply it to the driver and not the car.  NCD as a concept seems perfectly fine - no accidents means lower risk means lower premiums.  Perfectly sensible.  What is not sensible is applying it to an inanimate vehicle instead of the actual driver.  But of course, insurance companies are In business to make money, not necessarily to be sensible.

As above. No claims does not mean no accidents or lower risk.

Sandtree

Mickey666 said:

Sandtree said:

You have 2.5 separate concepts....

1) Claims history -  what it says on the tin, pure and simple is any claims (or incidents) in relation to a motor vehicle where you were the driver or policyholder. Its the simplest concept and is universal.

1.5) Insurance history - simply how many continuous years you have held insurance for... not a common question on Motor but fairly common on Home where NCD is a less developed concept.

2) NCD/NCB - is an artificial construct and exact rules vary between insurance companies. Some are fully transferable and others are designed to be hard to transfer. This in theory could be seen as a combination of claims history and insurance history but its not as it is complicated with factors like Protected NCD and Fault -v- Non-fault claims.

Think of NCD as a discount card or a physical thing... you can only give it to one policy at a time and some insurers will only accept it if its for the same vehicle class (car, van, bike) whereas others will accept cross class. Its increase/decrease is linked purely to the policy on which it is currently being used so a claim on another policy wont decrease the others.

Get a second vehicle for the first time? Your NCD is already on another policy so you have to start a new one. Similarly decide to go back down to one vehicle and there is no way to combine the two together or handing over both to the next insurer.

Were the discount not so substantial or if the majority of people didnt have 4+ years I would be much keener on the NCB name as its a "bonus".

No.  Your NCD, or at least the risk, relates to the DRIVER, not the new car.  No need for a new policy, just add the new car to the existing policy.  Yes, I know that’s not how it currently works but it could so easily be changed.  A driver might might own two, three, 100 cars but they can only drive ONE of them at a time!  The DRIVER is the risk being insured, not the car!

Most motor policies do not allow you to permanently insure two cars under the one policy. Obviously that could change, but it hasnt and people are advising on how things work today rather than the art of the possible.

Some insurers that used to offer a multi product discount or multi-car policy would apply an additional discount if both cars were only insured for the policyholder only... most policies do have named drivers and therefore its perfectly possible for each of the cars to be used simultaneously. Similarly insurers dont only cover policyholder driver risks... a parked cars brakes can fail and cause an RTC just as easily as a driven cars.

nottsphil

Were_Doomed said:

nottsphil said:

tr7phil said:

You can of course have a separate no claims discount on any number of vehicles.  An accident in one of the vehicles will only affect that vehicle's no claims discount but the accident will affect the price of the other vehicles' cover simply because the largest part of the insured risk is the driver and the driver has now had an accident.

That explains why an accident is relevant to the premiums of other vehicles. It doesn't explain why the lack of an accident isn't. 

So what's your take on it? What's your advice to the OP? (You're quick to criticise other posters - but that's all you've done, you've not otherwise contributed anything to this thread). 

As I was as equally in the dark as the OP, I had no 'take' and no advice to offer. I have, however, encouraged respondents into answering the actual question - satisfactory and comprehensive answers eventually arrived.
Actually it's you who has contributed nothing to the thread, unless you count antagonism. 

Were_Doomed

Nice selective quoting ... removing the bit where I did contribute by addressing the OP directly. 🙄
And asking you questions is antagonism? Ok ....... 👀

Mickey666

Sandtree said:

Mickey666 said:

Sandtree said:

You have 2.5 separate concepts....

1) Claims history -  what it says on the tin, pure and simple is any claims (or incidents) in relation to a motor vehicle where you were the driver or policyholder. Its the simplest concept and is universal.

1.5) Insurance history - simply how many continuous years you have held insurance for... not a common question on Motor but fairly common on Home where NCD is a less developed concept.

2) NCD/NCB - is an artificial construct and exact rules vary between insurance companies. Some are fully transferable and others are designed to be hard to transfer. This in theory could be seen as a combination of claims history and insurance history but its not as it is complicated with factors like Protected NCD and Fault -v- Non-fault claims.

Think of NCD as a discount card or a physical thing... you can only give it to one policy at a time and some insurers will only accept it if its for the same vehicle class (car, van, bike) whereas others will accept cross class. Its increase/decrease is linked purely to the policy on which it is currently being used so a claim on another policy wont decrease the others.

Get a second vehicle for the first time? Your NCD is already on another policy so you have to start a new one. Similarly decide to go back down to one vehicle and there is no way to combine the two together or handing over both to the next insurer.

Were the discount not so substantial or if the majority of people didnt have 4+ years I would be much keener on the NCB name as its a "bonus".

No.  Your NCD, or at least the risk, relates to the DRIVER, not the new car.  No need for a new policy, just add the new car to the existing policy.  Yes, I know that’s not how it currently works but it could so easily be changed.  A driver might might own two, three, 100 cars but they can only drive ONE of them at a time!  The DRIVER is the risk being insured, not the car!

Most motor policies do not allow you to permanently insure two cars under the one policy. Obviously that could change, but it hasnt and people are advising on how things work today rather than the art of the possible.

Some insurers that used to offer a multi product discount or multi-car policy would apply an additional discount if both cars were only insured for the policyholder only... most policies do have named drivers and therefore its perfectly possible for each of the cars to be used simultaneously. Similarly insurers dont only cover policyholder driver risks... a parked cars brakes can fail and cause an RTC just as easily as a driven cars.

I have a single multi-car policy, they are quite common aren't they?  Perhaps we're talking at crossed purposes here?

I also recall once having a policy (Admiral perhaps?) in which named drivers could accrue NCD, not just the main driver, which seemed sensible to me.

EDIT:  found this thread: https://forums.moneysavingexpert.com/discussion/4156707/what-companies-do-named-driver-ncd

OK, from 2012 but seems a lot of companies offer NCD accrual to named drivers - or did.

Sandtree

Mickey666 said:
I have a single multi-car policy, they are quite common aren't they?  Perhaps we're talking at crossed purposes here?

I also recall once having a policy (Admiral perhaps?) in which named drivers could accrue NCD, not just the main driver, which seemed sensible to me.

EDIT:  found this thread: https://forums.moneysavingexpert.com/discussion/4156707/what-companies-do-named-driver-ncd

OK, from 2012 but seems a lot of companies offer NCD accrual to named drivers - or did.

Define common? A number of insurers offer multi-car policies (one policy covering multiple private cars) and a  number offer multi product discounts (two policies covering two cars but discounted).  In practice the majority of private cars are covered by a single policy not a multi-car policy even if you only consider households with more than one car.

ND NCD was "created" by Direct Line (or they copied it from someone outside the UK), and inevitably where one insurer goes others follow but its a small number and if you look behind the branding you'll see many are the same company (eg Direct Line and Churchill). When first created it was intended to create lock in as whilst if a proof of NCD is or isnt accepted by your next insurer is their choice alone DL (and the others that followed) went to lengths to ensure the NDNCD, Motorbike transferred to Car and Foreign NCD (which they rolled out at the same time) were clearly not normal NCD in the hope that others would reject them and so you would stay with DL as your ND would take their policy out with DL to be able to use the NDNCD.