If you’ve ever had to claim from your car insurers or report an accident, you’ll know just how long and drawn out the whole process will be. Even if the accident wasn’t your fault, the chances are your insurers will take your excess to begin with and settle the money later down the line.
The other party may even dispute the fault of the accident and instead blame you, so the process will take even longer until the insurers can contact witnesses, view CCTV and even attend court. It’s never as straightforward as receiving the money you’re rightfully owed.
Your vehicle may even be written off as a result of the accident, which for many motorists can seem a strange decision. Even if from looking at the car it can be repaired, insurers may well decide it’s too costly and issue money respective of what they believe the car is worth. In many instances, this is less than you paid for the car. In this instance, you may want to look at some great cars under £10,000, as reported by Jardine Motors.
But what about your no claims bonus? Will it be affected and what exactly is it?
What is a no claims bonus?
No claims bonuses are set-up by your car insurer as a way to promote safe driving and reward motorists who don’t claim. No claims bonuses stretch to five years and say you can enjoy a 75% insurance discount with one.
If you make a claim during this time, your no claims bonus will be scrapped. This takes into account any claim, such as accidents and even if your vehicle is stolen.
Of course, if you’re not at fault for the accident (in the insurers eyes), your no claims bonus will remain. If it’s deemed knock-for-knock (spilt liability) then you can lose some or all of your bonus.
How to protect your no claims bonus
Ideally you won’t be having any accidents and your no claims bonus will remain intact, however you can pay extra to keep your no claims bonus protected. Premiums may rise if you claim, but your file will still state a no claims.
How much does a no claims bonus save?
Each car insurer will use a different system to calculate how much your insurance should be. Factors range from where your car is kept, to how many miles you journey. The no claims bonus does have a significant impact though and uSwitch claim just one year’s no claims can save you around 30% on car insurance.
This value isn’t representative of all motorists though and your own annual premiums will be unique to your lifestyle.