Every year you drive without filing a car insurance claim, you can build up a No Claim Discount (NCD). The NCD is applied to your usual annual premium and, spoiler alert, you get a discount! It’s in the name, guys.
In fact, if you go claim-free for five or more years, you could bag a discount of up to 70% on your car insurance policy! Makes those annual premiums a lot more palatable, right?
You might have heard of a No Claim Bonus. But don’t let the terminology confuse you! No Claim Discount, No Claim Bonus – it’s all the same concept.
So let’s get into the nitty-gritty of what NCD is all about, how it relates to short term car insurance, and how to make sure yours is protected.
What exactly is a No Claim Discount and how do I earn it?
A No Claim Discount is a benefit you earn when you complete a full year with your insurer and don’t make any fault claims.
A fault claim is a claim where the full amount can’t be reclaimed from the third party. So, while this includes cases where you’ve accidentally dinged someone else’s car, it can also include things like theft, fire, and malicious damage.
While you might feel like it’s not technically your fault if your car was stolen, it can still be recorded as a fault claim because your insurer will have to pay out.
So if you’ve made a claim on your insurance, you might not accrue NCD for that year, you might lose your NCD if you had any, or your NCD may be stepped-back (reduced). If you haven’t had a fault claim against your policy, you’ll accrue one more NCD year – which translates to a percentage saving against your premium.
Can I earn NCD if I’m a named driver on someone else’s policy?
Many policies only allow the main policyholder to accrue No Claim Discount benefits. This means that if you’re an additional driver on someone else’s policy, you’re likely not building up your own NCD.
So when you get your own car and take out insurance in your name, you may need to ‘start from scratch’ when it comes to building up your NCD.
This is important to keep in mind because some newly qualified drivers engage in fronting, where they lie about who the main driver on the policy is. Not only do they risk serious repercussions if they get caught out, but also, they shoot themselves in the foot in the long-term because they don’t accrue NCD.
Check out our article on fronting here to work out if you’ve accidentally fronted and what to do to resolve the situation.
What is No Claim Discount Protection?
NCD Protection is like that one friend who has your back no matter what – it protects you from losing all your NCD in the event of a fault claim.
NCD (No Claim Discount) is basically a discount earned from driving carefully and not making any insurance claims. It takes years to build up and can result in a nice insurance premium saving every year.
So why would you want to lose all that hard-earned NCD?
That’s where NCD Protection comes in, offering the option to protect your NCD even if you do end up getting into a car accident or filing a claim.
NCD protection may not always be available for everyone, but if you have enough NCD under your belt, it’s worth considering adding to your car insurance policy.
The exact protection you’re likely to get depends on your insurer. Say, if you only have one fault claim, your NCD will likely stay the same with the protection, but your premium might increase. If you have more than one fault claim, your NCD might drop (but not disappear altogether).
All of this depends on your insurer, however. So make sure you read the T&Cs before you take out your NCD protection add-on.
What happens to my NCD if I need to claim on my temporary car insurance policy?
If you have an accident while covered by temporary car insurance, you still need to tell your usual car insurer when renewal comes around.
Of course, it’s always best to drive safe and avoid any “oops, I crashed the friend’s car” situations. But sometimes, accidents happen. And that’s why you have temporary car insurance, like Zixty.
Your No Claim Discount won’t be affected by the claim if you claimed on your temporary car insurance.
For the avoidance of doubt, if the crash happened while you were driving your friend’s car, you need to tell your insurer, but they don’t need to tell theirs. Got it? Good. Moving on.
What happens to the NCD of the car owner if I need to claim on my temporary car insurance policy?
If you happen to be involved in a car crash and need to claim on your temporary car insurance, don’t stress about it affecting the NCD of whoever’s car you’re borrowing. It’ll have no impact on their insurance policy and it won’t affect their NCD. They don’t even need to tell their insurer. They’ll be fine.
While we like to keep things easy to digest, there is one scenario that’s unlikely to happen, but in the interest of being open, here’s “full disclosure”. Standalone glass cover is not included with a Zixty temporary insurance policy. So, if there’s damage to the windscreen or glass that is not part of an accident, your Zixty policy will not cover it. For example, someone throws a brick at the windscreen or through a window, then the car owner would need to claim against their policy, and their NCD might be affected. But, if you were involved in an accident where the windscreen or glass was damaged, the Zixty policy is designed to cover this, and the owners policy and NCD should not be affected.
But, to reiterate, you will need to tell your insurer if you were involved in a crash. Yes, even if you borrowed someone else’s car and you had temporary car insurance covering you. The good news is, your NCD won’t be affected.
Can I use my NCD to get a discount on my Zixty short term car insurance policy?
Sorry to break it to you, but your No Claim Discount can’t be applied to our short term car insurance policy. Short term car insurance policies with Zixty are temporary, so you can’t transfer over those sweet NCD benefits. Think of it as a temporary fling – just enjoy the moment and worry about those long-term commitments later.
And hey, look on the bright side – we can get you on the road in minutes if you need to borrow your friend’s car. Plus, here at Zixty, we’ll even plant a tree every time you take out insurance with us. Surely, that’s got to make up for not being able to use your No Claim Discount.
Can I earn a No Claim Discount on my short term car insurance policy?
Unlike annual policies, short term insurance policies don’t offer the opportunity to earn No Claim Discount benefits (read more about the differences between short term car insurance and annual insurance). That’s because your NCD is accrued over a 12-month period, and temporary insurance only lasts a few hours to a few weeks.
So, in a nutshell, we can’t dish out any No Claim Discount deals. The model just doesn’t work because most of our insurance policies only last a few weeks. Soz.
Does Zixty offer NCD protection?
Because you can’t earn an NCD on a Zixty short term policy, and cannot use any NCD from another policy on a Zixty temporary car insurance policy, we don’t offer NCD protection.
No Claim Discounts: An Overview
No Claim Discounts can be complicated to get your head around, especially in the context of annual car insurance policies versus short term car insurance policies.
NCDs, or No Claim Discounts, are basically savings on your insurance premiums that reward safe driving. The longer you drive without making a claim, the bigger your NCD will be, pretty sweet right?
But here’s the catch – NCD only applies to annual car insurance policies. Meaning if you opt for a short term car insurance policy, your NCD won’t apply and you won’t accrue any NCD either.
It’s not as bad as it sounds though! Because if you end up having to claim on your temporary car insurance, it usually won’t affect your NCD on your annual car insurance. So in a sense, your NCD is ‘protected’ by your temporary car insurance in certain circumstances.