Why have no claims discounts reduced?

I have just renewed the insurance on our car. The renewal premium was quoted at £211 as against £142 for last year - a rise of nearly 50%. On examination, I discovered that the full premium had actually gone down but the NCD for 9+ years had been reduced from 57% to 23% meaning that I had to pay 77% of the full premium rather than 43%. Perhaps even more startling was that the NCD for 1 year had been reduced from 24% in 2022 to just 2% today. I finally decided to change provider and took out a policy with a higher full premium but an NCD of 51%. Can you explain how insurance providers arrive at these NCD figures and why they can vary so much from one provider to another and from one year to the next?

Asked on 8 March 2024 by Gordon Sigston

Answered by Louise Thomas

The exact amount of no claims discount offered to drivers can differ between insurance providers, so there’s not actually a guarantee about how much discount you’ll have when taking out a new policy. To guarantee lower prices, you should always consider switching providers when it comes to renewal as you could still be paying more this way, despite building up your no claims bonus.

Tags: insurance insurance renewal no claims discount

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