Wednesday, 13 August 2014

The Protected No Claims Bonus Explained

"It's alright, I've got protected no claims..."

This is a phrase we hear on a weekly basis here at Paint Perfect and unfortunately it proves that people don't really know what they are paying for when it comes to car insurance. Whether you have had a crash, or just a small accident in a car park, making an insurance claim is a totally new process to most people and a lack of understanding can leave a driver counting the cost.

Here is our guide to understanding the protected no claims bonus:

  • A No Claims Bonus is a percentage discount given as a reward for a number of years of driving without making a claim or having a claim made against you by a third party. 
  • Protected No Claims means you will not lose this percentage discount if you make a claim or have a claim made against you. 
  • The Insurance Premium is the price you pay for your insurance cover. This is calculated on your risk as a driver (taking in factors such as vehicle usage, type of vehicle, occupation, age, location and claims history)
  • The Excess is the amount of money the insured driver pays when making a claim. These are usually made up of a compulsory excess and a voluntary excess.
  • Voluntary Excess is the amount of money a driver has agreed to pay in the event of a claim. Increasing the voluntary excess when taking out a policy is a way of reducing the premium. 
The key thing here is that the price you pay for insurance is based on how much of a risk you are. If you have protected no claims and choose to make a claim your percentage discount remains the same however as you have made a claim you are seen as an increased risk and therefore your premium will rise. All too often we have heard stories from drivers that have claimed and expected to pay the same price for their renewal because of their protected no claims bonus. 

The thing to keep in mind when getting a quote to get your car bodywork repaired is to look at the bigger picture. Paying more than your excess for a repair may be a much cheaper option in the long run. At Paint Perfect we always try and help our customers by giving them as much information as possible. If you have questions about making insurance claims or repairs to car bodywork call our Lincoln office on 01522 568247 or e-mail Alternately come and see us at the workshop on Clayton Road, Newark Road Industrial Estate, Lincoln, LN5 8RE