worth getting protected no claims?

Depends on the price.

If you've only got 5 years ncb then it might be worth it. I have 10 years so it's not worth it (unless it's a nominal amount).
 
iaind said:
You don't lose all your NCD if you claim anyway. But it generally doesn't add much so you may as well.

Remember the NCD is a discount. So your risk profile will have a price associated with it. Say that price is £1000 but your insurer offers a 50% discount for your no claims, your price is £500.

Now if you claim, you have to declare it regardless so your premium will go up. Let's say it goes up to £1500 but you have protected no claims, you still get 50% discount so you'd pay £750. If you don't protect it, you might lose some of your discount so the price would still be £1500 but with only 25% discount meaning you pay £1125

Nothing will prevent your premium rising if you claim, regardless of fault - protecting your NCD just reduces the impact by maintaining your discount
Click to expand...

The above is an excellent summary.

Also don't forget that premium loadings for claims won't just be added for the following year, they'll be added for the next 3 or even 5 years depending on who underwrites the policy. Admittedly the loading will decrease as time passes but it all adds up.
 
I would be very wary to insure my insurance. In any case I have 0 years NCB and my insurance for a 1.8 Civic is £370. However, it will probably go up next year as the dicounts I received will no longer be applicable.
 
SlyReaper said:
The most sage advice I've ever been given about insurance is, never insure anything you can afford to lose. This is because the premiums are always set at a level so that, on average, the insurer wins and the customer loses.

For example, I will never insure my mobile phone, because if it was destroyed, it would be annoying, but I could just buy a new one without it really impacting my life. The same logic applies to insuring your insurance. If you had a crash without protecting your NCD, it would be a bummer, but it wouldn't be a financially devastating event. Therefore, you're better off leaving it unprotected.
Click to expand...

While I understand the logic here (I don't play the lottery for similar reasons i.e. total prize pool is less than total receipts) it is worth noting that unlike some forms of insurance, motor insurance loss ratios are typically fairly high (in other words on average the consumer is getting shafted less than other forms of insurance). The reason for this is that somewhat surprisingly many motor insurers are not really in the business of making money from insurance - their real area of profitability comes from investments. The insurance arm is essentially just a means of obtaining large amounts of capital (premiums) for investment, although in recent years tighter regulation (i.e. need for lower risk investment / solvency) and relatively poor investment returns mean this is perhaps not as prevalent as it once was.

Another factor that may be worth considering is that insurance is basically just gambling based on perceived (statistical) risk which can be reasonably well modelled over a large sample size i.e. book of business. But as an individual customer you may be able to find an edge somewhere i.e. get 'value' from a quote if you think your actual risk is higher than that deduced by the insurance industry. For example if you are are a very bad and reckless driver but for whatever reason have never been involved in a claim you may believe your risk of an accident is higher than how you've been profiled.
 
Always seems to add on £100+ to my quote. If I'd paid it every single year then I'd be well down on my money over the time I've been driving by now. If it was something smaller like £10 then I'd consider it worthwhile.
 
Only made 12 quid difference for me with 9 years ncb. Not that its helpful for me to say that but you might find its cheaper else but the policy might be more. Always seem some of the cheapest insurers offer lower prices then hit you with admin fee or the cost of extras are a lot more then compared to other. Ahhh insurance the joy it is.
 
Depending on your insurer... they will take only 2 or 3 years off you if you have an accident and you still have to declare the accident anyway, so the discount you'll get for having NCD will be negated by the accident itself... fault or not.

They wanted an extra £50 on top of my £400 policy... I said no.

If it had been £10-20, I probably would have taken it.
 
You must log in or register to reply here.
Back
Top Bottom