The Bonus-Malus Scale

What is the bonus-malus scale?

A no-claims bonus scale is a table that insurers use to determine the no-claims discount on your auto insurance. The discount you receive is based on the number of claim-free years you have. The discount you receive varies by insurer. The no-claims bonus scale is also known as the no-claims bonus table, no-claims bonus scheme, no-claims bonus system, or BM scale.

How the bonus-malus scale works

The more claim-free years you have, the higher you are on the no-claims ladder. And the higher you are on the ladder, the greater your no-claims discount. For every year that you haven’t filed a claim, you move up a step on the ladder. This means a bonus in the form of a larger discount on your monthly fixed costs.

The bonus-malus scale therefore functions as a kind of reward system. The more claim-free years you have, the higher the discount (bonus). The discount can be as high as 80% of your insurance’s base premium.

How Claims Affect Your Discount

Are you filing a claim? If so, you’ll drop several steps on the no-claims discount scale and receive a smaller discount on your premium. With every insurer, you’ll always be set back 5 claim-free years on the no-claims discount scale if you file a claim.

If you file multiple claims and consequently move down the no-claims discount scale, you’ll receive a smaller discount and may even have to pay a premium surcharge. This is called a penalty. For example, this happens if you file multiple claims in a single insurance year.

Maximum number of steps

The number of steps on the no-claims ladder therefore varies by insurer. Where you start on the no-claims ladder is different for every insurer. Have you accumulated 5 claim-free years? With one insurer, you’ll start at step 10 on the ladder, while with another, you’ll start at step 11.

Maximum discount on your auto insurance

Just like any ladder, a bonus-malus ladder also has a top rung. If you’re on this rung, you’ve reached the top. This means you’re getting the maximum discount. You’ll still accumulate claim-free years, but they no longer count toward your no-claim discount.

Maximum number of claim-free years

People in the top tier can therefore have 15 claim-free years, or even 30. However, there is a maximum number of claim-free years, which is 99.

Request your premium from your insurer

Your auto insurance provider must inform you each year of how many claim-free years you have. That is why your accumulated claim-free years are listed on the insurance policy you receive from the provider each year. In your auto insurance’s no-claims discount scale, your claim-free years determine which tier you are in.

Negative claim-free years

So, as long as you don’t file any claims, you’ll receive a nice discount on your premium. But what if you file multiple claims and drop so far down the ladder that you end up with a negative number of claim-free years? In that case, you won’t receive a discount; instead, you’ll have to pay a surcharge on your premium.

Learn more about negative claim-free years.

Apple Tree Registration

We’re also familiar with the term “malus record.” The Latin meaning of “malus” is “bad.” You’ll receive a malus record if you’ve accumulated negative claim-free years on your auto insurance policy. This means you have fewer than 0 claim-free years. For every claim you file, you lose 5 claim-free years.

A penalty record will cause your insurance premium to go up. It’s also often difficult to have this record removed. This is only possible after several years of driving without any claims.

Don't file a claim for minor damage so you don't end up having to do it again

In some cases, it’s better not to file a claim with your insurer for minor damage. With every claim—and with every insurer—you’re set back five claim-free years on the ladder, regardless of the amount of the claim. For minor damage, it’s therefore better not to file a claim and to pay for the damage yourself.

Damages Without Fault

If someone else causes damage to your vehicle, this will not affect your no-claims discount. The insurer will then seek reimbursement from the party that caused the damage. Be sure to always take photos to prove that the damage was not your fault.

No-claims protection to maintain your discount in the event of a claim

When you purchase your auto insurance, you can opt for a no-claims protection plan. This means you can file one claim each year without your no-claims discount being reduced.

Please note: You will still move down the no-claims bonus scale. However, this will not affect your premium as long as you have no-claims protection. Without no-claims protection, you will pay a higher premium for your auto insurance if you file a claim.