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What is the point of opting to insure against the loss of no claims bonus on car insurance
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Maverick
Posted: 06 March 2011 15:12:13(UTC)
#21

Joined: 04/10/2010(UTC)
Posts: 59
Another insurance scam you should bear in mind - when my firm stopped giving company cars, they gave us an allowance, to cover the cost of leasing a new car. But you didn't have to, so you could use the allowance and buy a "dog" and run it into the ground. That's what I did - a Citroen ZX turbodiesel, which I ran for four years until it began showing signs of tiredness (it had done 242,000 miles!). So I bought another identical one on eBay, intending to run the two side-by-side till I was happy the new one wasn't going to let me down big-time.

I rang up my insurers and asked them to put two cars on the insurance - identical spec - shouldn't cost me anything. I am the only driver on the policy and I can only drive one car at a time, after all. The guy on the phone sounded shocked - "That's not how car insurance works, sir!" In short, I had to start from scratch, with NO no-claims bonus, for the second car. The insurers refused to use the no-claims bonus on one car to assess the risk when I drove another, identical, car.

No-claims bonus is a rough-and-ready indicator of risk - no claims, good risk. It is not like bank account credit which you can use up. Why have punters allowed insurers to get away with this, because I can't possibly have been the first in this situation? And does anyone know a (legal) way round the problem?
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Chris Clark
Posted: 07 March 2011 08:00:47(UTC)
#22

Joined: 11/11/2009(UTC)
Posts: 30
I found the best way to get out of this sort of circus was to give up the day car and use the bus, and buy and use a classic car for occasional use.

Talk about peace of mind. Wonderful.
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JK
Posted: 07 March 2011 09:10:19(UTC)
#23

Joined: 21/07/2009(UTC)
Posts: 11
Be smarter in future and stop complaining in the meantime.

Protecting your No Claims Bonus is an expensive way of telling your insurance that - I am a soft touch. I don't intend to shop around in the future and I will stay with you whatever the cost. In fact I am such a soft touch that I will pay you this money for the priveledge of being unable to shop around after I put in a claim.

We live in a capitalist society where companies' first priority is to make money for their shareholders. You have to expect that insurance companies will try to get the maximum amount of money from you. If you pay this No Claims Bonus element - you are putting a giant red flag on your head emboldened with the message, that I am not very good with money, I am trusting and naive and money burns a hole in my pocket. Faced with this message you have to expect the insurance companies to take your money.

I have shares in 2 insurance companies and I want them to exploit you in this way to make me the best return I can get. Lets face it you would most likely fritter the money away some place else, if you didn't hand it over to them so carelessly. And when I have your money I will look after it much better than you. However, I would prefer to live in a society where people were not so naive, where everyone understood the capitalist dynamic that we live with and got good value for their money.

Please don't complain though. You entered this agreement willingly. You were outsmarted by the insurance company. The slightest bit of thought at the beginning would have told you that this was a terrible idea. Learn from this mistake and move on.

Capitalist companies will not change - you have too.
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S G
Posted: 07 March 2011 10:14:29(UTC)
#24

Joined: 06/03/2009(UTC)
Posts: 8
Its shocking how many people think protecting your No Claims Discount not worth anything. These people do not fully understand. Yes it costs you money as you are insuring yourself against making a claim.
But guess what insurance companies also do this, they re insure themselves against large claims, they do this to minimise the risk of having to pay out a large claim, so they can keep costs down. What I mean by large claim is a large number of claims due to one insistence. For example a home insure, could insure its self with having to pay out against an incident such as a large flood. We know we have had a few over the last few years. The insurance company would pay for the first £20m worth of claims (or what ever level they have insured themselves for) and claimed the rest.
If the bill came to £22m the insurance company may not claim as they may be able to afford it, however if the bill was £50m they probably would claim for the additional £30m.
Now going back to NCD, and why I think some of these comments have been made by people who actually have no clue, ie person previously, with the use of the interenet, you only need 20 mintues to find out how competitive your renewal is, no one is stopping you from shopping round and changing insurer. But lets say you make a claim and don’t have you NCD protected, your renewal premium goes up, so you shop around and find a cheaper deal. WELL DONE, but if you still had you NCD that deal would be even cheaper!!!! Your New Premium stills costs MORE then it should..
When your renewal comes through it details your NCD, you sometimes need this to prove to the other insurance company.
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