How does my no claims discount work?
How does my no claims discount work
- What is a no claims bonus
- Can I use my no claims bonus on more than one bike
- How long is my no claims discount valid for after a long lay-off period
- Can I protect my no claims discount
- Can I easily rebuild my no claims bonus
- Could I lose my no claims bonus if an accident wasn’t my fault
- What’s a ‘step-back’ on my no claims bonus
- What’s the maximum amount of no claims bonus I can accrue
- What about licence endorsements
What is a no claims bonus
When you first take out a bike policy you probably won’t have any NCB (no claims bonus), but for every year that you don’t make a claim on your policy your insurers will credit you with a percentage discount that is used to reduce the premium for the following year.
If you stay claim-free for a number of years the discount can build up to a very substantial percentage, and this NCB is something that you can use with your existing insurer or take with you to your new insurer when getting an alternative quote at renewal.
Can I use my no claims bonus on more than one bike
Yes, but only by having a multi bike policy (there is usually a limit on this up to four bikes). If you have one policy already running it gets all the benefits of the NCB, and the next policy would be treated as if you were a new rider.
How long is my no claims discount valid for after a long lay-off period
The industry standard is two years but it would also be worth going back to your original insurers as they may cut you some slack.
If you are going to take a break from bikes, make sure that you get NCB proof paperwork when your cover expires, as insurers don’t keep those records for long.
Can I protect my no claims discount
Yes, some bike insurance companies will let you protect your NCB, if you are willing to pay an additional premium, you may be able to keep all, or part of that hard-won discount, even if you have to make a claim.
So, make sure to tell us how many years no claims discount you have when you begin to compare bike insurance with us, and see whether the cheapest company also offers NCB protection and, if so, at what cost when evaluating your quotes.
Can I easily rebuild my no claims
If you do lose your NCB through having a claim, it might be worth saving the pennies for a few years, and insuring a lower value bike Third Party Fire and Theft (TPFT), TPFT which covers you against damaging or injuring other people or their property, as well as Fire and Theft, but it won’t cover you for own-fault prangs.
But if it lessens the cost of building up your NCB and you aren’t doing any miles, you can compare bike insurance in a few years’ time, and it could well be worth it.
Could I lose my no claims bonus if an accident wasn’t my fault
In some cases, yes. Your no claims bonus is lost if your insurer is unable to claim all of the costs back of any claim you make, so, if you’re in an accident with an uninsured driver or rider, or if your bike is stolen, there is a good chance you will take a step-back on your no claims bonus.
It’s worth noting your no claims will be protected if you have an accident and the party at fault is insured and your insurance company are able to retrieve all the costs back.
What’s a ‘step-back’ on my claims bonus
When someone with NCB makes a claim, they generally don’t go from the maximum straight back to zero. They step back one or two places for each claim they make. Generally people usually lose two years NCB for one claim.
What’s the maximum amount of no claims bonus I can accrue
It varies from insurer to insurer, but often, 5-6 years will be the maximum amount of discount you can accrue, so even if you have more than 5-6 years, you won’t receive any further discount.
What about licence endorsements
Every insurance company is going to want to know your driving and biking riding record, and it’s oh so easy for your throttle hand to get the better of you and before you know it, you’re getting to know a bike cop or a Magistrates Court, picking up penalty points for speeding.
One SP30 on your bike (or in a car) is acceptable, get two or more your motorcycle cover is going to cost a lot more than it did before.
It’s worth noting insurers rate many features of the bike and the rider; claim free periods are one, a big one, but even if you have a max NCB, convictions mean your cover is going to cost a lot more than it did before.
Did you find this article useful?
If you have any questions we haven’t answered on NCB please comment below and one of the team will get back to you!
Written by Jon Urry, MCN Journalist.
Reviewed on 14th February 2019 by Andrew Campbell, MCN Legal Advisor.
Edited by Sian Daly, MCN Compare content editor.
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