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The no-fuss guide to no claims discounts

 
Car stopped at a zebra crossing to let pedestrians cross  

At AXA, we think safer drivers should be rewarded. That’s why we’re one of many insurers to offer a no claims discount for safer drivers.

No claims discount (NCD), also called no claims bonus (NCB), could save you a lot of money on your car insurance each year, but the rules surrounding no claims can be difficult to decipher at times. And if you’ve ever wondered how your no claims discount is calculated, what could impact your discount or how to prove what level of no claims discount you’re entitled to, you’re not alone.

To help, we’re going to strip away the jargon to reveal the need-to-know about no claims discounts.

What is a no claims discount?

No claims discount is a discount you get on your car insurance premium for each claim-free year of driving on the policy. It's your insurance company's way of saying thank you for being a safe driver. The more claim-free years you have, the better your discount will be. With AXA, you can accrue up to 20 years of no claims, which can save you a packet when it's time to renew.

How do you build up no claims?

You build up your no claims discount for each claim-free year on your car insurance policy.

If you do have an accident that isn’t your fault, your no claims discount will not be affected if your insurer is able to recover all the costs of the accident from the other driver’s insurers.

How do you prove what no claims discount you are entitled to?

Your renewal notice from your current insurer will include information on how many years no claims you have and you can use this to back up your application when you switch to a new insurer. If you want to use this as proof of no claims, make sure that the policy it relates to didn’t expire any more than two years ago. Your no claims may also be checked and confirmed via an insurance industry database, meaning you don’t have to supply proof yourself.

What can impact your no claims discount?

Your no claims discount is affected by claims on your policy, but it won’t be affected by claims on your policy caused by another driver as long as your insurer can recover all the costs of the claim from the other driver’s side.

However, if there is no other car involved and no other insurer to recover from, your no claims discount will be affected.

With AXA, your no claims discount won’t be affected if you’re hit by an uninsured driver, provided the accident isn’t your fault and you’re able to provide the make, model and registration number of the car in question. Windscreen claims also don’t affect your no claims discount.

What happens to my no claims discount if I cause an accident?

Insurers have different scales of no claims discount and the extent to which your no claims discount is affected will depend on the individual insurer’s scale, what level of no claims discount you start the policy year with, and how many fault claims you have in the policy year. For information on how your own discount could be affected, it’s always best to speak to your insurance provider.

Does a no claims discount impact your premium?

Your insurance premium depends on a number of things, and your no claim discount is just one of them. Your address, age, driving history – including claims and convictions – and how you use your car can all have an effect on your premium.

How long does proof of no claims last?

Your proof of no claims will usually be accepted for up to two years after the expiry date shown on the policy. This can vary from insurer to insurer, so it’s always a good idea to check with your current provider. So if you’re off the road or not driving for more than two years, you may have to start from scratch and build up new no claims.

Can named drivers build up no claims?

It’s usually only the policy holder that earns the no claims discount. Some insurers do allow named drivers to build up no claims, however these are often only recognised by the company issuing the discount.

So usually, if you're a new driver using your parents' policy or are the second driver of your spouse's car, you'll start from zero if you get your own car insurance in the future. However, its always worth checking with the company you want to insure with to see if they will recognise no claims earned as a named driver.

Is it possible to use no claims built up on a company car?

If you’ve been claim free while driving a company car, you'll be happy to hear that some insurers will allow no claims discount earned during this time. Proof of the number of claim-free years will need to be on the company’s letter-headed paper, signed by the fleet manager or company director, and dated within the last six months.

You must also have been the main driver on the car – had no more than one speeding conviction and no at-fault accidents within the last three years.

What if I get into an accident and don't tell my insurer?

Sorting out the costs of an accident privately might sound like a good way to avoid impacting your no claims discount, but it's never a good idea. The other party’s claim could turn out to be more expensive than originally thought, meaning that they claim through their own insurer who in turn may contact your insurer. This could result in your insurer refusing to deal with the claim, declaring your policy invalid, and could also affect your no claim discount. You still don't have to make a claim, it's just important to let them know what's going on.

What is no claims discount protection – and do I need it?

It takes a lot of careful driving to build up no claims discount, and most drivers desperately want to protect it once they earn it. No Claims Discount Protection lets you keep your discount even if you do get into an accident or need to claim. With AXA's Protected No Claims Discount you can have one claim in a year, or two claims across three years, without losing the years you've already built up. We also let you add it to your policy when you have as little as one year’s no claims.

 
Roadblock

It can take a lot of skill and safe driving to earn a no claims discount, but the unexpected can happen to even the most careful drivers, so it’s always wise to try and protect your no claims discount when possible.

Adding protection to your policy is the safest way to do this, and means one mistake won’t cost you the rewards you’ve spent years building up.

Protect your driving reputation with AXA

Learn more about AXA’s Protected No Claims Discount and our other car insurance extras, or find the right cover for your needs by getting a quote below.