What is the meaning of no claim?
No claim literally means: no claim. The meaning of no claim has to do with damage free years. Insurers reward damage-free driving by means of a discount on the premium. This discount is also called no-claim discount. The more claim-free years you build up, the more discount you will receive on the insurance premium. Do you claim a loss at the insurer? Then you lose part of your no claim discount and you pay more premium again. In this article we explain to you what no claim exactly means.
No claim discount meaning
No-claim discount is the discount you get on the premium of your car insurance. For every year that you do not make a claim against your insurer, you receive 1 claim-free year. The more claim-free years you build up, the more no-claim discount you will receive. In this way the insurer rewards you for damage free driving.
It is always wise to check first whether it is better to claim or to pay a damage. For each claim you will lose 5 claim-free years, regardless of the amount of the claim. You then immediately drop a number of steps on the bonus malus ladder, and your premium will increase considerably. It then takes another 5 years before you are back at the same level of discount as before the damage. Therefore, in the case of small claims with a low amount of damage, it can be more profitable to pay for the damage yourself instead of claiming it from your car insurance company. Often the premium increase that arises when you make a claim is higher than the total damage amount of a small claim.
No claim protector meaning
With a number of insurers you can take out no-claims protection. With a no-claims protection you can claim one damage per year, without your insurance premium immediately increasing. There is, however, a disadvantage to no-claim protection. You retain your premium discount, but you lose a number of claim-free years. This means that if you want to switch insurance, you will have to pay a higher premium. So you are actually tied to your current insurer. Nevertheless, it can sometimes be worthwhile to switch to a cheaper insurer and temporarily pay more, especially if the discount will be high in the coming years.
What does damage mean for my no claim?
Claiming car damage is at the expense of your claim-free years and your no claim discount. If you are liable for someone else's damage, this is compensated by your insurer. However, this is also at the expense of your claim-free years. There are a number of claims which are not at the expense of your no-claim years. These are all damages that fall under the limited casco part of your car insurance. For example damage caused by fire, storm or hail, window breakage, theft of the car or a collision with stray animals. If you have car damage caused by someone else, you can recover the damage from the insurer of the other party. Also in this case your no claim will remain intact and you will not lose any claim-free years.
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