Protecting Your No Claims
As your No Claims Bonus builds up, it’s well worth considering paying a little more on your premium for No Claims Bonus Protection. That way, if you do have an accident and make a claim, you still keep the discount for cheaper car insurance that your claim-free driving has earned you over the years.
Of course, the number of claims you make tells the car insurer what risk you pose to them. So if you are unfortunate enough to have to make another accident claim soon after a first, the chances are you’ll have to wait a while before you can protect your No Claims discount again.
It is possible to compare car insurance cover offering the added benefit of No Claims Bonus protection if, through no fault of your own, you are involved in an accident with an identified uninsured driver and have to claim on your own policy. That’s reassuring since recent reports suggest that as many as 1 driver in 20 is on the road without car insurance.
However, if you do make a claim when you have No Claims Protection, that does not necessarily mean there will be no increase when your premium is due for renewal.
As with everything else, the cost of car insurance overall can increase each year. One factor is your insurer’s potential costs in the event of a claim - the spiraling rate of litigation for injuries (such as whiplash) and the fact that insurers now have to pay the NHS for accident and emergency services are two other examples. Even the stock market can make a difference.
Another reason why the cost of your car insurance quote might rise if you have made a claim - even with a protected discount - is that the policy may be subject to ‘loading’ charges.
Loading Charges on Your Car Insurance Premium
When an underwriter calculates a premium, one of the factors taken into account is the driving history of the person to be insured.
If that includes a claim having been made, the car insurance company can take into consideration details of the claim such as the type, the cost and the fault/not fault aspect. Fault and non-fault is not a reference to blame. A non-fault claim is where the insurer can recover full costs from another insurer. In instances where their costs cannot be recouped, then it is called a fault claim – even if the accident wasn’t the fault of the insured driver. A prime example is car theft, in which case there is no third party to pay the cost.
As a result this can add loading to a premium, the cost of which might not necessarily be cancelled out by any discounts due to you.
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