A protected no-claims bonus helps keep your discount after certain claims, but it does not guarantee your premium will stay the same.
A protected no-claims bonus is an optional feature on some car and van insurance policies. It is also known as protected no-claims discount, protected NCB or protected NCD.
A no-claims bonus is a discount you can build when you hold insurance without making a claim. The discount is not the same with every insurer. The ABI says no-claims discounts can vary by insurer, and may rise as you build more claim-free years.
Protected no-claims bonus can help protect that discount if you make a limited number of claims. It does not mean your full insurance price is protected.
The rules depend on the insurer and the policy. MoneyHelper explains that no-claims bonus protection is usually an optional add-on. It may let you make one or more claims within a set period without losing your no-claims bonus.
Policies limit how many claims can be made before the no-claims bonus is reduced. The limits and time periods vary, so check the policy wording.
If you do not have protection, a fault claim can reduce your no-claims bonus. The Financial Ombudsman Service explains that insurers often apply a “step-back” after a fault claim affects no-claims bonus, but the exact rules should be set out in the policy.
No. This is an important point.
Protected no-claims bonus protects the discount, not the whole premium. The Financial Ombudsman Service says protected no-claims bonus does not mean the price is protected. Your renewal price may still rise after a claim.
That can happen because insurers look at many risk factors. These can include your claims history, vehicle, address, occupation, mileage, driving convictions, vehicle use and policy details.
Our guide on accurate car insurance quote details explains why it is important to give clear and correct information when getting a quote.
Protected NCB may be useful if you have built up several years of no-claims bonus and want to reduce the risk of losing the discount after a claim.
But it is not right for everyone. You should compare the cost of the add-on with the possible benefit. You should also check the claim limits and policy conditions before deciding.
The value of protected NCB can depend on:
Before buying protected NCB, check the policy wording. The Financial Ombudsman Service says no-claims bonus rules vary between insurers, so the details matter.
You should also make sure your no-claims bonus, claims history and driver details are correct. The Financial Ombudsman Service explains that customers must take reasonable care not to make a misrepresentation when buying insurance. The ABI also says customers should answer insurer questions correctly and ask for help if they are unsure.
Clear wording is important. The FCA says firms should give customers information they can understand and that communications should be fair, clear and not misleading.
At Got You Covered, we arrange car insurance and van insurance through insurers. We may be able to help drivers with previous claims, motoring convictions or a low no-claims bonus.
We can help you understand what insurers may ask for, what proof of no-claims bonus may be needed, and whether protected NCB is available on the policies offered to you.
Availability, cost and claim limits depend on the insurer and the policy terms.
Protected no-claims bonus can help protect the discount you have built up after a limited number of claims.
It does not guarantee your premium will stay the same. Always check the claim limits, exclusions, cost and policy wording before you rely on it.
