Hi
Zest here!
Recently, a client reached out with a question about their No Claim Discount (NCD). They had stopped driving for about 8 months and recently bought a car, wanting to know if they could still enjoy their NCD even though they didn’t renew their car insurance with the same insurer they used for the vehicle they sold 8 months ago.
Here are some insights about NCD that aren’t commonly shared:
- Maintaining Your NCD: Most insurers allow you to keep your NCD if there’s a break in vehicle ownership, typically for up to 24 months. However, some insurers limit this to just 6 or 12 months. It’s important to check with your insurer for their specific guidelines.
- Transfer of NCD: You can only transfer your NCD to your spouse or child, but this is only possible with the same current insurer. Transferring to a spouse isn’t applicable if you switch to another insurer.
- Accidents and NCD: You won’t lose your NCD if you’re found to be completely not at fault in an accident involving another vehicle. However, in other situations, your NCD may be affected. Some insurers do offer NCD protection in case of a claim.
- NCD Protection Limits: Having an NCD protector doesn’t guarantee that it will transfer to another insurer, and it won’t prevent your insurer from canceling or refusing to renew your policy.
- Certificate of Merit Bonus: If your NCD is 30% or higher for a private car policy, or 20% or higher for a privately owned commercial vehicle, some insurers may reward you with an additional 5% discount upon presentation of your Certificate of Merit.
I hope these insights help you better understand how your NCD works!
If you ever have any questions or need further clarification, don’t hesitate to reach out. I’m always here to help!
Best Regards,
Zest Chia
Executive Wealth Consultant | Associate Estate Planning Practitioner |
Licensed General Insurance Advisory
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