It’s no secret that No Claims Bonuses (NCB) can save bikers a considerable amount of money.
If you, or a third-party don’t make any claims on your insurance policy, you’ll begin to build up your bonus. Think of your No Claims Bonus as a reward for not claiming on your insurance policy for a specified period of time. This bonus will then be reflected in your premium, meaning you could pay less for your insurance going forward.
Here are 5 things you need to know about your No Claims Bonus:
You could lose your No Claims Bonus even if you’re involved in an accident that wasn’t your fault
If you’re involved in an accident, there are some instances where you may lose your No Claims Bonus even if you weren’t at fault for the crash. This tends to be the case if you’re involved in an accident with an uninsured rider or driver, but it can also happen if your bike is stolen and you decide to make a claim.
If you’re involved in an accident with an insured driver, it may be possible to claim the costs from their insurance rather than your own. This means you won’t lose your bonus, but the other driver will lose theirs.
There are ways to protect your No Claims Bonus from uninsured drivers and theft
Most insurers offer customers the opportunity to ‘protect’ their No Claims Bonus so that if they’re hit by an uninsured driver, have their bike is stolen, accidental damage, malicious damage or vandalism they won’t lose their bonus.
If you decide to protect your bonus, this will mean your insurance premium may increase.
You can carry your No Claims Bonus over from one insurer to another
If you decide to change your insurance provider, you can transfer your No Claims Bonus over. This means that your new insurer will offer you a more cost effective deal than they would if you hadn’t built up a reputation for being a safe driver. You can only transfer NCB from car to car and bike to bike.
You’ll have to provide proof of your No Claims Bonus
If moving from one insurer to another, the new insurer will most likely check up on your No Claims Bonus and will want to see a photocopy of your insurance certificate as proof. If you exaggerate your bonus and you get caught, your policy may be invalid.
Proof can usually consist of the last renewal invite letter from your previous insurer or the cancellation letter from your previous insurer. It’s important to remember that the proof of your No Claims Bonus needs to be in your name and dated within the last two years.
The amount of money you’ll save on your No Claims Bonus will vary depending on your insurer
Each insurer has their own way of calculating how much of a discount to offer those who’ve built up their bonus. This will usually be tiered so, for example, those with a one year No Claims Bonus will have a smaller percentage reduction than those with a five year bonus.
There’s usually a limit to the number of years you can grow your bonus. If your insurer has a six year limit, for example, and you don’t make a claim for 6 years, the percentage reduction will be capped and you won’t be eligible for a larger discount.