No Claims Bonus Protection

Understanding how No Claims Bonus Protection works in Ireland can help you avoid losing your discount after a claim. Firstly, a No Claims Bonus (also known as a No Claims Discount) is a discount that an insurance company will offer if you have not claimed in several years. A maximum discount is generally offered if you are 5 to 6 years claims free. This discount could reduce your van or car insurance premium by over 50%.

What is No Claims Bonus Protection?

“No Claims Bonus Protection” differs from a “No Claims Discount.” A No Claims Bonus Protection is an optional extra you can add to your policy; it protects the discount on your car insurance in the event of a claim.

Criteria and limitations may apply depending on the insurance company. These limitations may include the number of claims you can make in a certain period and/or the value of these claims. You may lose your discount if the number of claims or costs exceeds the terms of the contract. For example, if you make over three claims in two years or if the claims exceed a specific value outlined in your policy documents. Read the policy documents carefully. If you are unsure, call the insurer, who will review the details with you.

There are two types: “Full No Claims Bonus Protection” and “Step Back Bonus Protection”.

What is a Full No Claims Bonus Protection?

This benefit provides the top level of cover in the event of a claim. If you have this additional add-on, you will not lose your discount in the event of a claim. This cover will fully protect your discount.

What is a Step Back Bonus Protection?

A Step Back Bonus Protection is another add-on that protects your No Claims Discount; it is generally less expensive than the Full No Claims Bonus Protection. If you are involved in an accident and a claim is made against you, a Step Back Bonus Protection will offer you protection for a partial discount. It will not protect your full discount.

For example, if you’ve been claim-free for six years and make a claim, the Step Back Bonus may reduce your discount to four or five years. However, your discount may be reduced from 50% to 25%.

Does a No Claims Bonus Protection come as standard?

No Claims Bonus Protection is an optional extra; you must pay an additional fee to protect your discount. This benefit is optional. However, if you decide not to include this benefit in your policy and make a claim, you may lose your discount. We suggest you ask customer support for a quote with this level of protection and without it. This will give you a better idea of the cost and help you decide whether to add it to your policy.

You can also explore our Comprehensive Car Insurance and Third Party Fire and Theft guides to compare different levels of cover. To learn more, call our team on 042 935 9090 or get a quick online motor insurance quote here!