Your no claims discount (NCD) or no claims bonus (NCB) can help cut insurance costs, but is it transferable between different types of vehicle?
Here, we find out whether or not you can apply your motorbike no claims to a car insurance policy.
Can I transfer my motorbike NCD to a car?
Broadly speaking, no. If you’ve built up a no claims discount on your motorbike, you won’t normally be able to transfer it to a car insurance policy. There are a few exceptions to this and some insurers will let you transfer your no claims, but it’s down to each provider to make that decision.
If you find an insurer who’ll let you transfer an NCD from a motorbike to car, you’ll usually need to meet certain conditions, for example:
- You must not have made any claims in the last few years.
- The no claims discount must not be currently used on another policy.
- You must have held a full UK driving licence for a certain number of years.
You may find that even if insurers don’t accept an NCD earned through your motorbike insurance, you might get a goodwill discount on your car cover. If an insurer offers this, it’ll usually be dependent on your riding history – for instance, how long you’ve been riding a motorbike and whether or not you’ve made any recent insurance claims.
Can I transfer my NCD to another type of vehicle?
In most cases, you can’t transfer your NCD to a different type of vehicle. For example, you can’t use a motorbike NCD for a car or van or vice versa.
You can of course, transfer your no claims to another vehicle of the same type, so, from car to car or motorbike to motorbike.
Can I use my NCD on more than one vehicle?
No, you can only use your no claims discount on one vehicle at a time. If you buy a second car, you’ll need to build up its own no claims discount.
Don’t multi-car policies share a no claims discount?
Multi-car insurance policies are a simple and convenient way to insure more than one car registered at the same address, but each vehicle essentially has its own policy. For example, you can have three cars on one policy, but each one can have a different level of cover and even different excesses.
The no claims element is treated in the same way. If you’ve built up eight years’ worth of no claims, this will be applied to the premium for your car. Whereas if your spouse has five years’ worth, this will be applied to the premium for their car. Similarly, if a child has just learned to drive, they won’t have earned any NCD.
This means that each driver on a multi-car policy can build up their own NCD and take it with them if they decide to buy their own individual policy at some point.
How does a no claims discount work?
You earn a no claims discount if you drive for 12-months without making a claim on your car insurance. If you have a temporary policy or cancel your insurance before 12-months, you won’t earn an NCD for that year.
The discount you get is shown as a percentage, this is then taken off your premium at renewal. The more years of no claims you have, the greater the discount.
The discount applied varies by insurer but one year of no claims typically means you’ll get around 30% off your premium. Five or more years of no claims could reduce your premium by as much as 75%.
How does an insurance claim affect my no claims discount?
If you have an at-fault claim (where you cause an accident) then your insurer will reduce your no claims discount. Usually, it will mean losing two years’ worth so if you’ve built up six years of NCD, you could be left with four years of no claims. This in turn means you’ll get a smaller discount when you come to renew your premium.
If the accident was not your fault (a non-fault claim) and the other driver’s insurer covers costs, then your NCD should not be affected.
What does protecting your no claims discount mean?
NCD protection is a feature offered by almost all insurance providers. You pay a little extra for it, but it means that if you make a claim, your NCD remains unaffected.
Does protecting my no claims discount stop premiums increasing?
No, protecting your NCD does not prevent your premium from increasing. Remember – no claims protection only protects the discount you’ve built up.
From an insurance point of view, policyholders that have made one claim are more likely to make another. At renewal, this increased risk of a claim will be reflected in your new premium – your NCD is then applied after this is calculated.
- Before a claim, your insurance policy costs £1,500.
- You have five years of NCD, giving you a 60% discount, which means you pay £600 for your policy.
- You make an at fault claim but have protected your NCD so this stays at five years.
- At renewal, your base premium rises to £2,000 because your risk profile has increased.
- Your new policy costs £800 because even though your NCD is the same, your base premium has risen (£2,000 minus 60%).
How can I keep the cost of vehicle insurance down?
No claims discounts can help you lower car insurance premiums significantly, but there are other ways to keep costs down, including:
- Paying for your policy annually instead of in monthly instalments.
- Only buying additional features that you’ll realistically need.
- Adding an experienced named driver with no recent claims to your policy.
- Driving fewer miles.
- Keeping your car as secure as possible overnight.
- Comparing all levels of car insurance, more often than not, comprehensive cover isn’t as expensive has you might think.
For more ideas and practical tips on how to get cheaper car and motorbike insurance, we’ve put together these informative guides:
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