When you receive a no claims discount on your insurance, it can feel like you have truly earned it. After all, you have spent quite a few years building up your good graces with your insurer. You have never made a claim and, if you have, you have never been the one who is actually the one at fault.
As a safe and careful driver, you know that you deserve a discount on your car insurance premiums. However, you may be wondering how much of a discount you can actually get on your no claims policy. Here is some information on what is actually the highest discount you can get on your no claims discount (NCD).
What is a no claims discount?
If you have not claimed on your car insurance for 1 to 5 years, then your insurer will offer you the chance of gaining a no claims bonus or no claims discount (NCD). This discount does vary between insurers and depends on how long you have had the NCD. The longer you have had it, the higher your discount may be.
If you are a new driver or struggling to afford your insurance premiums, then you may want to gain your NCD as soon as possible. While most clients can wait out the time needed to obtain their discounts, there are insurers who are willing to offer accelerated policies where you only need to wait 10 months to get your discount. The insurer will count the 10 months as a full year.
Whilst this does sound ideal for saving money, please keep aware that investing in a quicker discount policy may cause you problems in the future should you want to switch providers. This is because some insurers do not accept accelerated bonuses. If that is the case, then you will not be able to find a deal that could save you money.
How much could I get on my discount?
Again, it is important to reiterate that the highest discounts you could gain do depend on the length of time for which you have had your bonus. While policy on these discounts can vary between insurers, the principle they abide by is that, if you drive safely, you will pay less.
The premium’s discount is usually – going by averages – 30% for the second year, 40% for the third year, 50% for the fourth year, 60% for the fifth year and 65% for the sixth year. If your no claims discount is 65% and you would typically paying around £1,000 on your annual premium, this means that the NCD could reduce your premium to only about £350.
Is it worth getting a no claims discount?
While it can be useful to gain an NCD when you are still a relatively inexperienced motorist, as you continue to pay for your policy, you may find that changes to your policy result in you being rewarded for your good driving skills less and less as time goes on.
As The Guardian reveals, though your NCD will strongly influence your insurer’s assessment of your driving risk profile at policy renewal time, many other factors come into play as well. Those include your age and occupation, as well as how you have used the vehicle for which you were insured.
This means that your insurer will not only base your future NCD on your claims history. They will also look into whether or not you have enough experience to remain safe on the road, as well as whether or not your life, and its daily stresses, could become a cause for concern on the road.
This means that your premium could go up even if you have only a minor accident, as it does not matter how many years of protection you have had.
Should I protect my no claims discount?
If you decide to protect your discount, you can create a safety net around it by talking to your insurer about protective insurance. With this protection, if you are involved in a certain amount of accidents where you were the one at fault, this will not affect your bonus and you will be able to keep it.
This also means that, if you have an accident or your car requires a new part to be replaced, then your insurer can’t claim their costs. However, be sure to check this with your current insurer, as some but not all insurance companies may still raise the cost of your premiums even if you have this insurance.
How else can I save money on my car insurance?
Gaining a NCD is a fantastic means of landing in a lower price range for your insurance, but keep in mind that there are some other ways for you to find cheap insurance. These include:
- Shopping around: If you ask us at Call Wiser to compare insurance quotes on your behalf, you can tap into a very useful way to personalise your insurance requests. That way, you can see what will be useful to you at the best price possible.
- Keeping your car safe: Your insurer will look into your driving history and where you park your car at night. Don’t leave your car’s safety to chance; instead, lock your car in a garage away from thieves. You can also install a tracking device. This will keep the vehicle fully protected from thieves.
- Go on a Pass Plus scheme in order to gain more experience: Your insurer wants to see if you are safe and experienced while you are on the road. Joining this scheme will give you more training with a professional teacher.
- Multiple drivers: If the policy covers only drivers who intend to drive the vehicle regularly, you may get a higher premium due to another person’s background.
If you are able to combine your discount with these additional tricks of saving money on your car insurance, then this will increase the chances of you finding a fantastic deal on car insurance as quickly as possible.