Multi vehicle insurance policy

HuskyDad

Hi, when I got a second vehicle in 2023 I went with a multi vehicle policy. It's renewal time and it's looking like 2 separate policies would be cheaper than going with another multi vehicle policy. I will have 6 years no claims from the first vehicle and the second will have been on a multi policy with no claims for 2 years. What do I put as the no claims number of years for the second vehicle? Thanks

flaneurs_lobster

Would seem logical to apply the longer period of no claims for any insurance quote because that's how long you've had car insurance without making a claim.

However, No Claims Discount (and Number of Years NCD) can be defined any way that the insurers choose, hence Protected No Claims Discount policies where they'll ignore a claim when telling you what your bonus/discount is because you've paid them more money.

Your prospective insurer will still need  to know about any claims (and will price accordingly) even though you've still got the same NCD/B.

I assert the whole thing is marketing flim-flam, and to argue against this you would have to show where a quote has been meaningfully altered because NCD/B has been added or withdrawn.

Bottom line, don't think it will make any difference.

MyRealNameToo

HuskyDad said:

Hi, when I got a second vehicle in 2023 I went with a multi vehicle policy. It's renewal time and it's looking like 2 separate policies would be cheaper than going with another multi vehicle policy. I will have 6 years no claims from the first vehicle and the second will have been on a multi policy with no claims for 2 years. What do I put as the no claims number of years for the second vehicle? Thanks

You need to check with your current insurer... if its really two seperate policies with a multi-product discount and harmonised renewal dates its likely you have one NCD of 6 years and one NCD of 2 years. 

There are a minority of providers that do actually do a true mutlivehicle policy in which case you'd likely have a single 6 year NCD in which case were you to insure separately one vehicle would be on 0 NCD. 

flaneurs_lobster said:

Would seem logical to apply the longer period of no claims for any insurance quote because that's how long you've had car insurance without making a claim.

However, No Claims Discount (and Number of Years NCD) can be defined any way that the insurers choose, hence Protected No Claims Discount policies where they'll ignore a claim when telling you what your bonus/discount is because you've paid them more money.

Your prospective insurer will still need  to know about any claims (and will price accordingly) even though you've still got the same NCD/B.

I assert the whole thing is marketing flim-flam, and to argue against this you would have to show where a quote has been meaningfully altered because NCD/B has been added or withdrawn.

Bottom line, don't think it will make any difference.

As you say it's a marketing tool not something that represents risk hence your first statement is totally incorrect. You can own a dozen vehicles and each one will have a different NCD, they cannot be merged, divided or copied. Were your statement correct someone would have the same NCD across all their vehicles but that isnt how it works. 

flaneurs_lobster

MyRealNameToo said:

As you say it's a marketing tool not something that represents risk hence your first statement is totally incorrect. You can own a dozen vehicles and each one will have a different NCD, they cannot be merged, divided or copied. Were your statement correct someone would have the same NCD across all their vehicles but that isnt how it works. 

My first sentence is not a statement, it's my opinion as to how NCD/B might be applied across coverage of several vehicles. The insurers choose not to operate the scheme this way.

It's rather illogical (at least to me) that you can have contiguous NCD/B when changing vehicles (or indeed insurance companies) but the same discount cannot be applied across coverage for multiple vehicles.

It's not as if a different NCD/B is applied if I change my vehicle from a Range Rover to a 10yo Dacia., why does the same discount not apply across all my cars?

It's a marketing gimmick.

Has anyone ever had an insurance quote where there was a discount rate or amount itemised as being due to the application of the claimed NCD/B?

MyRealNameToo

flaneurs_lobster said:

MyRealNameToo said:

As you say it's a marketing tool not something that represents risk hence your first statement is totally incorrect. You can own a dozen vehicles and each one will have a different NCD, they cannot be merged, divided or copied. Were your statement correct someone would have the same NCD across all their vehicles but that isnt how it works. 

My first sentence is not a statement, it's my opinion as to how NCD/B might be applied across coverage of several vehicles. The insurers choose not to operate the scheme this way.

It's rather illogical (at least to me) that you can have contiguous NCD/B when changing vehicles (or indeed insurance companies) but the same discount cannot be applied across coverage for multiple vehicles.

It's not as if a different NCD/B is applied if I change my vehicle from a Range Rover to a 10yo Dacia., why does the same discount not apply across all my cars?

It's a marketing gimmick.

Has anyone ever had an insurance quote where there was a discount rate or amount itemised as being due to the application of the claimed NCD/B?

Historically insurers used to list what the NCD levels represented as a fixed discount, a minority still do. 

These days insurers list what the average discount received is for NCD, for example Axa's is https://www.axaconnect.co.uk/siteassets/broker-documents/personal-lines/product-support-documents/2024-axa-personal-lines-intermediary-cma-table.pdf 

In practice NCD has been much more complex for a long time which is why insurers generally stopped stating what the discount is but the CMA determined an average must be posted. Axa is relatively generous with a 35% discount at the top end, some stick to the 65-70% top end as per the traditional scale and many more are lower, from memory DL used to be about 15% 

Of cause level of discount on its own is a little pointless, most people have maximum NCD and so get the biggest discount possible but you need to know what the underlying premiums are to work out if its a good deal or not. 70% off a big premium can still end up being more expensive than a 15% discount off a small premium. Its only those on lower NCDs where it makes a material difference but then those with the biggest scales often offer an introductory discount of around 30% for those with a clean record so the real scale is smaller than it first appears. 

flaneurs_lobster

Thanks @MyRealNameToo, far more factual post than my generalised rant.

My problem, that you allude to, is the lack of transparency on a mechanism that has become so embedded in the process of insuring vehicles that I suspect it is simply ignored each year.

Specifically, when I renew I am invited to pay additional premium in order to "preserve my no claims discount".

If I have no idea what this "discount" is worth, even when applied to the quote I am completing at the time, how can I make an informed choice as to the worth of "preserving" this discount?

MyRealNameToo

You are free to do a quote stating you have no NCD 

Part of the problem is that insurers often have a floor, the minimum they will sell a policy for. So if you are already very cheap then the NCD may only take you to the floor and so you receive less NCD... one user here claimed their 20 years was worth £5. However were you to have a claim the premiums would no longer be low and so the NCD would have more value. 

flaneurs_lobster

MyRealNameToo said:

You are free to do a quote stating you have no NCD 

Might do that as an exercise, try quotes for my "new car" with and without my 9 years (or is it 20?) NCD.

What I'd like on any quote is a line that says 

"You have claimed n years NCD. This has reduced your premium by x £"

MyRealNameToo

flaneurs_lobster said:

MyRealNameToo said:

You are free to do a quote stating you have no NCD 

Might do that as an exercise, try quotes for my "new car" with and without my 9 years (or is it 20?) NCD.

What I'd like on any quote is a line that says 

"You have claimed n years NCD. This has reduced your premium by x £"

In principle it could be done simply, though the IT quote we had to make a modest change to the quote letter was £150,000 and it proved impossible to get the Marketing Director or Commercial Director to gamble their annual bonus on making the change would increase the bottom line by sufficient to get over the hurdle rate. Even if they had then it'd be a case of having to show a higher return on investment that others pitching for the same funds were willing to bet their bonuses on. 

flaneurs_lobster

MyRealNameToo said:

flaneurs_lobster said:

MyRealNameToo said:

You are free to do a quote stating you have no NCD 

Might do that as an exercise, try quotes for my "new car" with and without my 9 years (or is it 20?) NCD.

What I'd like on any quote is a line that says 

"You have claimed n years NCD. This has reduced your premium by x £"

In principle it could be done simply, though the IT quote we had to make a modest change to the quote letter was £150,000 and it proved impossible to get the Marketing Director or Commercial Director to gamble their annual bonus on making the change would increase the bottom line by sufficient to get over the hurdle rate. Even if they had then it'd be a case of having to show a higher return on investment that others pitching for the same funds were willing to bet their bonuses on. 

Absolutely right, as a purely commercial decision I'd make the same call. Any changes to how financial products are marketed or described tend to be driven by regulatory change not whingey punters like me.

The bit that does annoy me is the offer to "protect" my NCD for a fee.

If the value of the NCD cannot be quantified, how can I make a judgement on whether this "protection" offers any kind of value?

MyRealNameToo

flaneurs_lobster said:

MyRealNameToo said:

flaneurs_lobster said:

MyRealNameToo said:

You are free to do a quote stating you have no NCD 

Might do that as an exercise, try quotes for my "new car" with and without my 9 years (or is it 20?) NCD.

What I'd like on any quote is a line that says 

"You have claimed n years NCD. This has reduced your premium by x £"

In principle it could be done simply, though the IT quote we had to make a modest change to the quote letter was £150,000 and it proved impossible to get the Marketing Director or Commercial Director to gamble their annual bonus on making the change would increase the bottom line by sufficient to get over the hurdle rate. Even if they had then it'd be a case of having to show a higher return on investment that others pitching for the same funds were willing to bet their bonuses on. 

Absolutely right, as a purely commercial decision I'd make the same call. Any changes to how financial products are marketed or described tend to be driven by regulatory change not whingey punters like me.

The bit that does annoy me is the offer to "protect" my NCD for a fee.

If the value of the NCD cannot be quantified, how can I make a judgement on whether this "protection" offers any kind of value?

No, it's also driven by others internally who think change will drive improvements. The above case was our MD thought the quote letter looked terrible, especially if you'd done more than one quote online and all he wanted to do was to change it form a horizontal chart with new quotes added as additional rows to a vertical chart with additional quotes being new columns. Unfortunately he couldn't convince the Marketing or Commercial guys to agree that it would actually drive conversion rates. 

There were plenty of other non-reg changes we did make, we made the logic on cross selling other products much smarter rather than how it originally was which was if you bought motor it promotes home and visa versa. 

In my day the NCDP was effectively 1 years NCD so the net result of having 5+ NCD was as if you had 4 years NCD, 4 years = 3 years with NCDP etc. Things are highly likely to have moved on and different firms no doubt have different pricing mechanism.