Have you ever pondered on what a No Claim Discount (NCD) or a No Claim Bonus (NCB) is? Or the possibility of saving extra money on your car insurance if you didn’t make any claim for the whole year? Find out this and lots more in this article.
What is a No Claim Discount?
A no claim discount is a decrease in the expense of your car insurance offered by your insurance firm if you didn’t claim the term of the vehicle insurance policy. It is a reward to you for the cautious utilization of your vehicle. So, let’s say you don’t make a claim on your car for a year or two or five, you’ll have the same amount of year(s) of no claim discount applied to the underlying expense of your car insurance.
How do I build my NCD?
For each year you’re insured without making a claim, you’ll get another year’s NCD. You can gain a discount of up to 30 percent on a year’s car insurance costs. Following five years this could be as much as 60 percent. A few insurance companies offer quickened policies where you can procure a reward in 10 months instead of 12. You can build up a vast number of NCD; the more you abandon making a claim, the more your discount will be.
If I make a claim, what happens?
On the off chance that you make a claim on your policy where your insurer pays out, and the accident was your doing, you’ll lose a few or the entirety of your discount. Be that as it may, if the accident isn’t your doing, your insurer might have the option to reclaim the payout from the other car’s insurer, and your NCB may not be affected. In situations where fault can’t be agreed on, insurers may split the expense of the claims and the two drivers’ NCB could be affected. This incorporates if your car is stolen or harmed by an awful climate.
If you pay for another policy with a reduced NCB and it was later discovered you are not at fault, you can generally get your NCB restored and a discount on the additional premium you paid.
What are the limitations?
Most insurance firms take the last five years of continuous driving in your name into account while assessing the discount estimation of your NCD. The discount applies to the only policyholders, and not other named drivers on a car. Your NCD must be utilized on one vehicle, so if you have two vehicles, you cannot get this discount on a second insurance policy except if the NCD on the subsequent car has been earned in its own right independently.