What Does No Claims Discount Mean?
17 October 2022 | 
Andy Moody
Do you want to pay less for your car insurance premium? Safeguarding your No-Claims Discount is the route to take.
A No-Claims Discount is the light at the end of the tunnel for drivers who kept a steady eye on the road, managed their mileage and kept their cars in top shape.
It’s a long road ahead, and we want you to reap the benefits of careful driving. So, let’s unpack what a No-Claims Discount is and how you can manage and protect your No-Claims Discount.
What is No-Claims Discount or No-Claims Bonus?
No-Claims Discount Waiting Period
Maximising No-Claims Discounts
Fully Comprehensive Temporary Car Insurance Provider
GoShorty – Protect my no-claims discount
Vehicles and No-Claims Discount Explained
How can I keep a No-Claims Bonus without a car?
Can I transfer No-Claims Bonus from overseas?
Can I spread my No-Claims Bonus across two policies?
How does No-Claims Bonus work on multi-car policies?
Can a named driver build up a No-Claims Bonus?
Can you change your car insurance policy without losing your No-Claims Bonus?
What is No-Claims Discount or No-Claims Bonus?
A No-Claims Discount (NCD) is also referred to as a No-Claims Bonus (NCB), and these terms can be used interchangeably.
An NCD is a reward for drivers who have not made any claims for over a year at their current car insurance provider.
Your insurance provider will reward you with a discount on your car insurance premium for the following year should your No-Claims Bonus be intact.
All insurance companies follow set criteria when determining your No-Claims Discount. However, the following factors will influence your final No-Claims Bonus:
- The types of vehicles that you drive: a van, motorcycle or car.
- The category that your vehicle fits into: private (personal usage) or commercial usage
- The period that you were insured without making a claim
One of the things to consider when choosing a car insurance provider is what the insurance company’s No-Claims Bonus offers. You want to enjoy your insurance premium while knowing that future rewards are excellent.
No-Claims Discount Waiting Period
Some insurers allow you to earn your NCB within ten months with an accelerated insurance policy. However, the general rule is that insurance companies will start calculating your No-Claims Discount 12 months from when you have been insured.
So, your insurance company will add to your No-Claims Discount every 10-12 months you drove without making a claim. This means that your reward, the No-Claims Bonus, will grow as long as you’re not making a claim.
As mentioned before, most insurers follow similar rules when setting standards for No-Claims Discounts. However, many insurers work case-to-case basis when setting the exact bonus. So, it’s worth shopping around and switching insurers if possible.
Maximising No-Claims Discounts
By this point, you might realise that one can accumulate an infinite amount of NCB.
All you have to do is not claim for years and years, right? Car insurance providers have a safety net in place for this. What’s the maximum No-Claims Discount that you can amass?
Most insurance providers have a cap of five years for a No-Claims Discount, while some insurance providers allow up to nine years for accumulating your No-Claims Discount. Infrequently, insurers will provide an unlimited amount of years to collect your No-Claims Discount.
Well, hey, lucky are those that go accident-free throughout their lives.
Suppose you do not claim or have discount protection over the years; your discount increases. Again, the exact increases and clauses vary from insurer to insurer.
Your insurance provider should list the maximum amount of claim-free years on your policy documents, so read your insurer’s paperwork with a keen eye.
No-Claims Discount Protection
Your following questions may be: “How do I protect my No-Claims Bonus?” and “What does No-Claims Discount Protection mean?”
No-Claims Discount protection or protected no claims is a safety valve for the insured. Your insurer will offer you claims protection, a small fee paid to protect your NCB in the event of an accident.
So, this allows for some elbow room as you can claim for a collision even if you’re the ‘at fault’ driver without losing your entire NCB. With the 20-50% reward, your NCB is worth protecting.
A few of our top tips to protect and maximise your No-Claims Discount:
- No-Claims Protection: pay an extra fee to protect your No-Claims Discount.
- Claim-free driving: make a claim only when needed. If possible, avoid claiming at all. If you make a claim, you risk losing a portion or the entirety of your NCB. Your claims history tells a story about you as a driver.
- Compile evidence: If you’re involved in a collision that’s not your fault, ensure that you can provide proof by documenting the scene of the accident. Suppose your insurer can provide proof that the other driver was at fault. In that case, their insurance provider will pay out, and this will have the other driver’s NCB affected instead.
- Policy documents: Get proof of your NCB protection by safeguarding and understanding your policy documents. Thoroughly assess car insurance letters, car insurance cancellation documents, and all other paperwork between yourself and your insurer.
- Switch providers: Insurance providers offer varying car insurance costs and rewards. If your current insurer doesn’t speak to your needs, then it’s time for a new provider. Insurance providers can transfer your accumulated No-Claims Discount from your previous insurer. You can contact your previous insurer and ask for the necessary documentation to switch insurers.
- Comprehensive car insurance: If feasible, opt for fully comprehensive car insurance. Comprehensive car insurance covers extra car insurance costs, which can provide you with protection, especially in the case of small claims. If long-term, fully comprehensive car insurance is out of reach, consider temporary car insurance.
Fully Comprehensive Temporary Car Insurance Provider
At GoShorty, we provide fully comprehensive short-term or temporary car insurance. If you need comprehensive cover for an hour-long drive or up to 28 days, then buckle up because we have something for everyone!
GoShorty – Protect my no-claims discount
Suppose you’re a driver that needs a flexible car insurance provider that will protect your No-Claims Discount. In that case, GoShorty is the route to take.
Here’s a list of drivers with scenarios that can benefit from our temporary car insurance whilst protecting their own car insurance policy’s NCD, the NCD of a company car, or that of the main driver:
- Uninsured driver
Suppose you are not the primary driver or a named driver. In that case, our services allow you to take out short-term insurance to protect the main driver’s NCD and to insure yourself. This is the perfect way to protect someone else’s policy, especially if you’re borrowing a car or van for a short or one-off trip. - Emergency drivers
If you need to drive someone’s car due to an emergency, you can use our temporary cover to protect yourself and the main driver. Should you claim, we can cover repair costs, so you don’t have to pay more money for two claims.
Our plans are flexible, and you can get instant coverage on our website. - Young drivers
Go Shorty offer temporary student car insurance for students. Our temporary insurance is flexible and pocket-friendly. We’ve got you covered. - Learner drivers
We aim to make life on the road an exciting experience for learner drivers aged between 17 and 25. We offer up to 24 weeks of coverage to learner drivers to learn to drive with added security. - Collecting, test driving, and delivering a new car
Car care is of utmost importance, especially if it’s a new car. Many sellers do not provide drive-away insurance. Our temporary car insurance covers your new ride on the trip home.
If you’re interested in short-term car insurance, look at our hourly car insurance.
Vehicles and No-Claims Discount Explained
Understanding the terms of your NCD concerning your vehicle or vehicles is essential.
Multi-car policy
If you have multiple cars, you can share a No-Claims Discount between them under exceptional circumstances. A select few car insurance companies render mirrored No-Claims Discounts, and a mirrored NCD allows for your discount to be viable for your second car’s insurance.
With that said, mirrored discounts are infrequent, and the benchmark to quality for mirroring is relatively high. You’ll be assessed on your driving experience, driving history, age, and claims history, amongst others.
Additionally, the car you want to share an NCD with will have to be part of a multiple-car policy with the original car. The multiple-car policy should have the same policyholder and be taken out with the same insurer.
If your insurance doesn’t provide mirrored discounts, you might want to find an insurer that does. Most insurers do not allow mirroring. However you can have multiple NCDs, but you need to take out a brand new policy.
Alternatively, you can transfer your NCD between policies depending on your needs and usage.
Frequently Asked Questions
How can I keep a No-Claims Bonus without a car?
You can keep your No-Claims Bonus for at least two years if you do not have a car. If you have a new car, you should transfer your NCB over to it as soon as possible.
If you switched insurers, you should prove to your new insurer that you had a No-Claims Bonus at your previous insurance provider. You’ll need your No-Claims certificate. No more than two years should have passed since you have been without a vehicle.
Can I transfer No-Claims Bonus from overseas?
Yes, you can transfer your No-Claims Bonus from overseas to the UK.
You can retain your No-Claims Bonus by submitting a confirmation of your foreign No-Claims Bonus to your insurer in English.
Can I spread my No-Claims Bonus across two policies?
No, but you can transfer your No-Claims Bonus from one car to another, especially if you have two cars or more.
How does No-Claims Bonus work on multi-car policies?
If you have multiple cars, you should insure them separately but under the same plan, and your No-Claims Bonus will differ.
Can a named driver build up a No-Claims Bonus?
Yes, a named driver can build up a No-Claims Bonus as they are listed on the insurance policy.
Can you change your car insurance policy without losing your No-Claims Bonus?
Yes, you can transfer your No-Claims Bonus between car insurance providers. You should shop for quotes, choose the best option, and make the switch.
Final Thoughts
A strong-standing No-Claims Bonus is a hot commodity for drivers. However, if you do not protect your NCB, you might lose all of the benefits. If you fear losing your No-Claims Bonus, you should get a quote for our temporary car insurance.
At GoShorty, we protect your No-Claims Bonus even if you’re not in the driver’s seat.
Check out our guide on car insurance myths for more information.