Protected no claims

V_tricky

No, it's not a scam - insurers evaluate the risk at each renewal and price their policy accordingly. Statistically if someone has already had an accident, or a series of accidednts, they are more likely to have another accident.

This seems to come up fairly often on this forum, so again I thank mattymoo for his link to the ABI (Association of British Insurers) website which explains how the no claims discount works.

It's unfortunate that people don't realise how their premiums are calculated, or understand NCD, so I think it's worthwhile explaining again -

If any driver on the policy has an accident, it will affect the no claims discount (unless you have no claims discount protection) - however - this does NOT mean that your premium wont change.

Thanks to mattymoo for the following link which highlights how NCDP works:

Association of British Insurers

" Note, however, that it is the discount that is protected. Insurers need to take into account a person’s claims history in setting the next year’s premium, whether or not the discount is protected. "

So once a claim is made, the base risk will change (more than likely increase) but you will still get a discount on the overall figure.

All (or most) insurers will calculate risk (and therefore premium) on this basis, not just the insurer in the OP's post.

If you have a claim, at your next renewal your premium is likely to increase a little on the basis of this increased risk. You would then get a discount on the overall figure. If you don't have your NCD protected, your premium may not only increase because of this increased risk, but you will also get a much lower discount off the overall premium.

Say I've had no accident, and my premium is ten apples.
I have a 50% NCD, so only actually have to pay 5 apples.

If I add Protection to my NCD I have to pay half an apple for the privilege of NCDP.

I then have an accident. At next renewal my premium is 12 apples.

If I have protected NCD, I have to pay 6.5 apples (ie 50% of the cost of the insurance, plus a bit for NCDP).

If I don't have a protected NCD my discount is reduced to 30%, so I now have to pay 70% of 12 apples - ie 8

Does that make sense?

PS - Lisyloo - please let me know how you get on with claiming back the loading from your accident - I'd be really interested to hear how it goes.

Steve1981

derrick wrote: »

And as I said, "a scam by ins co's to get more money"

if you dont protect it and claim - you lose (part of or all of) your bonus AND get a loading for making a claim.

If you do protect - you get the laoding for making the claim.

Its not a scam its a choice - if you want it do it if you dont dont, simple

Steve1981

an interesting point is that with some insurers - if a named driver has a claim and they are removed from the policy at renewal, insurers will remove the loading for the claim - BUT not if you dont ask.

some still list the claim against the policyholder - which is incorrect so its always worth double checking

jon_doe_2

I have 9 yrs NCD, so what would happen to my discount if I was to make a claim and it was not protected?

Would I then go down to 7 yrs (which would still be full discount) or would my discount percentage go down from full (60% for example) to 2 yrs less (say 40%)?

If it's the percentage that changes, then protecting it may be worthwhile but if it's the yrs NCD that changes then it's not worth it. (obviously my premium would be loaded either way).

Cheers

shelly

jon_doe wrote: »

I have 9 yrs NCD, so what would happen to my discount if I was to make a claim and it was not protected?

Would I then go down to 7 yrs (which would still be full discount) or would my discount percentage go down from full (60% for example) to 2 yrs less (say 40%)?

If it's the percentage that changes, then protecting it may be worthwhile but if it's the yrs NCD that changes then it's not worth it. (obviously my premium would be loaded either way).

Cheers

Sorry can't answer about percentages as we have always protected hubbys NCB and only had one claim but as they are protected we haven't lost any of them.

In terms of years you might have 9 years NCB but on paper you only have as many as your last insurer recognises. Having said that apparently a few co's now do recognise up to 9 years NCB but if you went to one of them and sent them your NCB renewal as proof of NCB, if your present insurer only recognises say 5 years, thats all you can prove to your new insurer.

My hubby has about 15 years NCB but we can only ever say we have the maximum the ins co will recognise. Usually on screenscrapers we tick the "5 years or more" box.

lisyloo

PS - Lisyloo - please let me know how you get on with claiming back the loading from your accident - I'd be really interested to hear how it goes.

Just saw this so thought I'd give an update.

Accident was 2 years and 9 months ago when the driver hit a pedestrian who was running into the road.
Pedestrian has made a personal injury claim.
This has been turned down by the insurer on the basis of the accident report which includes a police report and witness statements.
Insurer has told me that "there was no way the driver could have avoided the accident".
Third party still wants to pursue the claim but has little time left (3 year limit on personal injuries).
Insurer at the time has said that if the time limit expires then they will refund the excess directly (rather than bothering to pursue the 3rd party) and mark it as a "no fault" claim.
New insurer has said they will refund premium loadings for last 3 years on receipt of the proof that it was a "no fault claim".

So, hopefully we only have to wait another 3 months.

I am very keen to get things sorted as the driver is almost 80 and I would hate for them not to receive the letter officially saying it wasn't their fault. However there is nothing I can do to speed things up.