A no claims discount is a reduction on your insurance premium for each year you go without making a claim. It’s often called a no claims bonus or NCD , and the discount usually grows the longer you stay claim-free.

How it works

  • You start earning it after a full year without claims.
  • Each additional claim-free year can increase the discount.
  • Some insurers cap the discount after several years, often around 5 to 9 years.
  • The exact percentage varies by insurer and vehicle type.

Simple example

If your car insurance would normally cost 1,000 and your no claims discount is 20%, you’d pay 800 instead.

Good to know

  • A claim can reduce or reset your discount, depending on the insurer and the type of claim.
  • You can sometimes protect your no claims discount for an extra fee.
  • If you switch insurers, you may need proof of your no claims history.

If you want, I can also explain how no claims discount is lost after a claim or how to protect it.