If you haven’t made an insurance claim for a couple of years, you'll probably qualify for a No Claims Discount on your Car Insurance premiums.
John Brady, Head of Commercial at John Lewis Insurance, explains how these discounts work and how to get the best deal on your Car Insurance.
"Careful drivers can really reap the benefits of No Claims Discounts. It's worth shopping around to combine the best protection for your discount, in case you do need to make a claim, with the lowest premiums."
John Brady, Head of Commercial at John Lewis Insurance.
Q & A with John Brady
Q. What's your background and what experience do you have that makes you an expert on providing financial advice?
A. I've worked in financial services for 20 years, including banking, credit cards and insurance. The last five have been spent at the John Lewis Partnership, where I helped to launch and develop John Lewis Insurance, including our personal insurance cover for homes, travel, pets, weddings, events, and of course, drivers.
Q. How are No Claims Discounts calculated?
A. No Claims Discounts reward careful drivers by giving them a reduction on their insurance premium if they don't make a claim. Usually, for every year that you have insurance on a car, but don't make a claim, you earn another year's ‘No Claims Discount', up to a maximum number of years.
Q. What sort of discount can I expect if I haven't made a claim in five years or more?
A. A minimum of five years without a claim usually qualifies you for the maximum discount with most insurers. This can mean 60 to 75 percent off your premiums. John Lewis Car Insurance offers a maximum No Claims Discount of 75 percent.
Q. Can I pay to protect my No Claims Discount?
A. Yes, by paying a little extra on your premium you can protect your No Claims Discount. This means you'll still receive the discount, even if you have to make a claim. However it's important to be aware of how many claims you can protect your discount against, and over what period.
With John Lewis Car Insurance, you can protect your No Claims Discount against any two claims made within three years.
Q. If my car is stolen, do I still lose my No Claims Discount?
A. You should remember that a No Claims Discount is not the same as a No Fault Discount. Unless you have paid to have your No Claims Discount protected, making a claim means that your discount will be reduced or removed, whether you’re at fault or not.
Q. Can I use my discount to get reduced premiums when insuring a second car?
A. This depends on the insurer. Some companies, including John Lewis Insurance offer an introductory discount on cover for a second car if you’re already insured with them.
Q. I've already got a No Claims Discount on my company car - can I transfer it to my own car?
A. This will vary between different insurers. With some, a No Claims Discount on a company car makes no difference to your personal premiums. However John Lewis Car Insurance will transfer any discount you've built up to your personal car policy.
Q. If I make a claim, do I lose my discount completely?
A. This is not usually the case. It's more likely that you'll be 'stepped back' to a lower level. For example, a four-year No Claims Discount might be reduced to two years. However, if you then have to make another claim in quick succession, and you haven't got a protected No Claims Discount, you’re likely to lose your No Claims Discount altogether.
Q. Have you got any expert tips for us?
A. No Claims Discounts can vary from insurer to insurer and each company calculates them differently. You should always shop around to make sure you get the best possible deal based on your claims history.