Worth paying to protect no claims?

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thedupleman
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Worth paying to protect no claims?

#1

Post by thedupleman »

Buying car insurance is anything but straightforward. Trawling through seemingly endless insurance products can make your head swim. And it gets more complicated when you consider additional charges. For example, is it worth paying extra to protect your no claims discount?
According to research by MoneySupermarket, by not protecting your no claims discount (NCD) – or no claims bonus – your premium could rise by 30 per cent if you make a claim. However, protecting a five-year NCD adds £23 on average to annual premiums. So if you stay claim-free, you'll end up out of pocket.
"Having reached the 'Holy Grail' of five years no claims discount, many motorists will be reluctant to run the risk of losing it and may consider paying extra to protect it," says Peter Harrison, car insurance expert at MoneySupermarket.
"Building up your NCD over a number of years can be a valuable commodity and can help reduce the cost of your premiums. But be warned, if you protect your policy but don't make a claim for a number of years, you could find that you're eroding any potential savings."
And thinking 'I'm a careful driver' isn't a watertight reason for not protecting that valuable NCD. As Gemma Richards, motoring offences expert at law firm Barlow Robbins, points out: "People need to be aware it's not just their own actions on the road that count. If you're hit by an uninsured driver, even if it isn't your fault, you could lose your no claims discount if you don't comply with the small print of your insurance policy."

Car enthusiast Oliver Chesher, 36, is a firm believer in protecting a NCD. The PR agency director from Cheshire says: "I've had a protected no claims bonus for more than 15 years because I learned my lesson with one or two minor scrapes when I was a teenager and have been ultra-careful ever since. I now drive a very fast Alfa Romeo and I dread to think what the going rate to insure it would be if I didn't have the full no claims.
"The protection hasn't saved me money, it's cost me money, but I'll never stop the protection."
But having a protected NCD doesn't make drivers invincible as George Brown, an accountant from Leamington Spa, recently discovered. Last September he made his first claim when something fell from a lorry and hit his car. Four months later, he drove into the back of a stationary car – his fault and his second claim. Then in March this year he hit a deer on a country road.
"It was my third claim in quick succession," says George, 31. "My next quote for insurance has increased from £600 to £1,100 per year.
"I've paid an extra £200 to have my no claims bonus protected over five years. This was not only to no avail but my next premium will increase by £500 and will continue to be high for years to come. As two of the incidents were no fault of my own, I would like to see a bit more leeway from the insurance companies on only two claims allowed in three years."
So is it worth it?
It's difficult to get an answer to this because all insurers are different – as are drivers' circumstances. Peter Harrison says that for, say, a driver with 20 years no claims who hasn't had an accident, it's definitely worth protecting it. But for most drivers it's more complicated.
If you're still mystified, you're not alone. The Daily Telegraph's Honest John says: "I remain completely unable to understand what a 'protected no claims discount' actually is.
"As far as I can gather, most readers involved in claims seem to have been penalised with increased premiums the next year, whether the claim was their fault or not and whether they had 'NCD protection' or not. What 'NCD protection' now is has never been satisfactorily explained to me, which is why I cannot satisfactorily explain it to baffled and furious readers."
If you're considering NCD protection, the advice is to shop around. And when getting insurance quotes, do one search with the extra cover and one without and then study the price differential.
Also, read the small print. If you make a claim, many insurers adopt a sliding scale when reducing a NCD – although again this depends on the company.
"Finally, motorists should remember it's the discount they're paying to protect, not the amount of the actual insurance premium," says Harrison. "If you do make a claim, it's likely premiums will rise as a result anyway. But it will protect you more than if you had nothing at all."


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Re: Worth paying to protect no claims?

#2

Post by Tomhappyapril »

In short yes protect them you get rated on the claim regardless but having ncb still gives you a discount ,if you dont protect them lets say 15 years ncb and you have a fault claim your ncb will drop to 3 its your gamble
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Re: Worth paying to protect no claims?

#3

Post by smokebelch »

Tomhappyapril wrote:if you dont protect them lets say 15 years ncb and you have a fault claim your ncb will drop to 3 its your gamble
sorry, thats utter tosh.......I was at 9 yrs last yr, had a bump, made a claim (unprotected NCD) lost a year thats all, had a loooooonng chat with my insurers at the time and they was saying that no insurer will take more that 30% off your NCD for a prang.......so your example of 15 yrs, would in actual fact reduce to no more than 10.
I have a relative that is involved in insurance (not sales etc) and she's told me on numerous times that NCD protection is a waste of money. It wont insulate you from losing some of your no claims, its just another money grabbing tactic from the insurance companies to fleece even more money out of the individual by feeding off the fear of losing your NCD.
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Re: Worth paying to protect no claims?

#4

Post by coupecrazyman »

If never done it , but maybe you take a risk. I don't no. As with all insurance they try there best to not pay out,,, all in the small print of course,,,had experiance with pet and unemployment ins and they don't pay up ,,,! All cancelled now n lesson learned after years of premiums so I say f. Um. Ill stand on my own two feet thank you,, you robbing fatherless companies.. Rant over
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Re: Worth paying to protect no claims?

#5

Post by Tomhappyapril »

I work for a big insurance company for a living i have to deal with questions this everyday in short i would protect my no claims up too you what you see best fit !
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Re: Worth paying to protect no claims?

#6

Post by villan1985 »

smokebelch wrote:
Tomhappyapril wrote:if you dont protect them lets say 15 years ncb and you have a fault claim your ncb will drop to 3 its your gamble
sorry, thats utter tosh.......I was at 9 yrs last yr, had a bump, made a claim (unprotected NCD) lost a year thats all, had a loooooonng chat with my insurers at the time and they was saying that no insurer will take more that 30% off your NCD for a prang.......so your example of 15 yrs, would in actual fact reduce to no more than 10.
I have a relative that is involved in insurance (not sales etc) and she's told me on numerous times that NCD protection is a waste of money. It wont insulate you from losing some of your no claims, its just another money grabbing tactic from the insurance companies to fleece even more money out of the individual by feeding off the fear of losing your NCD.
once you get to 5+ years the discount is the same isn't it? Otherwise eventually car insurance would be free if you didn't claim
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Re: Worth paying to protect no claims?

#7

Post by Tomhappyapril »

usually 1-5 give the bigger discount after that they still count but as big of a discount but as said above depends on the company
also it will cost alot more to protect NCB at 4 years than 15 ,protecting ncb can be a difference of a few pounds or even a pound ,once again depends on the company and your claim history
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Re: Worth paying to protect no claims?

#8

Post by Lexo »

I'll have to chip in and provide what seems to be the exception to the rule.

Had 2 years ncd, wrote off the 56 plate 2L Atlantic at the ring and got a payout loosing all ncd.
Got an insurance quote 2 months later for an Siii which was 2 years and 10k miles younger with the same 2.0 engine......... £14 more for the year, still fully comp.

:icon_razz:

All seems to be they'll quote you whatever they think they can to get your business imo
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Re: Worth paying to protect no claims?

#9

Post by cervantes »

Plasmastorm wrote:All seems to be they'll quote you whatever they think they can to get your business imo

:text-yeahthat: or possibly whatever they can get away with
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