Is protecting my No Claims Discount worth it?

A no claims discount (NCD) can be a reward for drivers who haven’t made a claim on their car insurance for a period of time. 

If you don’t make a claim during your policy year, your insurer will not have had to pay out to cover the cost of any damages or repairs. It also indicates to your insurer that you are a ‘safer’ driver than one who has recently made a claim. As such, your insurer may offer a ‘No Claims Discount’ (NCD) at the end of your policy year.

Some insurers will offer drivers the chance to protect their NCD if they build up several years’ worth. It depends on the insurer, but typically this is after 5 years’ worth of no claims.

What is no claims discount protection and is it actually worth it?

No claims discount protection typically means a policyholder can make a claim on their car insurance, if they need to, without losing their no claims discount altogether. However, there is usually a limit on the number of claims a driver can make over a period of time while still retaining the discount. This varies from insurer to insurer, so do check details first.

With no claims discount protection, a driver is essentially paying an extra fee to protect the number of no claims discount they have built up. It could be infuriating to have driven for five years or longer, without experiencing even so much as a minor bump or scrape to your car, and then find yourself involved in an accident which could result in you losing some or all of your NCD. 

For example, if you haven’t protected your NCD with your insurer, you could lose five (or more) years’ worth of no claims discount if another driver was to reverse into your car in the supermarket car park and you needed to claim for repairs.

In this scenario, your no claims discount could be lost, and you’ll need to build it up all over again.

Is it actually worth paying for, though?

It’s a question only the driver/ policyholder concerned can answer, as situations and circumstances will be different for everyone.

Firstly, speak to your car insurance provider to establish how much extra you’ll be paying to protect your no claims discount. This may be affordable for you, or it might push the overall price of your policy above the maximum you’re prepared to pay.

If you switch providers and inform your new insurers that you have a certain level of no claims discount, the responsibility is on you to prove that. You’ll be asked to provide evidence - usually your previous insurer will show this on your renewal invite. You can also ask them to send on confirmation.

Bear in mind that not all insurers have the same terms and conditions for NCD. If you have five-plus years of discount and then make a claim, you may lose all of your no claims discount with one insurer, while another may just reduce the years to two or three. 

It’s worth a conversation with your insurer to fully understand all the options when it comes to no claims discounts and paying for protection.


Get a quote for RAC Car Insurance. and talk to us about your no claims discount

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