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Lutz

No claims bonus

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I don't wish to hijack another thread regarding the need to notify one's insurance, but the thread raised a related question in my mind.

In Germany, if the insurance has already paid out a claim by a third party and you subsequently reimburse them with the full sum of that claim your original no claims bonus is reinstated. Is that the case in the UK, too?

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Not in that sense - if the third party's insurer accepts full liability and pays all your costs, then the No Claim Discount is restored together with any excess paid at the time.

 

 

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We can also protect our no claims, at a cost.

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1 minute ago, Paul_B said:

We can also protect our no claims, at a cost.

 

Usually by protecting the % discount - but it doesn't protect the base premium which usually goes up after a claim.

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So, if I understand your reply correctly, no claims discount is only restored if you were not at fault, but if you were, then it doesn't matter whether you pay the full sum of the claim back to the insurance company or not, your no claims bonus would always suffer.

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Just now, Lutz said:

So, if I understand your reply correctly, no claims discount is only restored if you were not at fault, but if you were, then it doesn't matter whether you pay the full sum of the claim back to the insurance company or not, your no claims bonus would always suffer.

 

Correct - unless protected as Paul B posted - worthwhile once you've built up full NCD

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51 minutes ago, Black Grouse said:

Not in that sense - if the third party's insurer accepts full liability and pays all your costs, then the No Claim Discount is restored together with any excess paid at the time.

 

 

But the whilst the NCB remains the same, premium is likely to increase as the insurer determines that there is now a higher risk.

 

My (protected NCB) insurance renewal price practically doubled this year.    When I questioned it I was told that I had a claim last year and thus the risk (and the premium) had increased.

 

That 'claim' was for where my unoccupied car was clobbered quite violently in a Tesco car park.  The third party driver immediately admitted liability, and photographs of the two cars in their final resting positions were taken and available.  

 

The 'claim' was immediately handed off by my insurance company to a claims management company who dealt with it from top to tail and successfully (but not without difficulty) recovered the not insignificant repair and like for like car hire costs from the third party.

 

Funnily enough, when I told the insurer that I would not be renewing with them again, the premium suddenly dropped to just a tenner higher than last year so I stayed put.  

 

It it does seem that insurers will use anything, including 'no fault non claims' to justify increasing premiums for 'increased' risk.

 

 

Edited by happynomad
To remove insurer's name.

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51 minutes ago, Black Grouse said:

 

Usually by protecting the % discount - but it doesn't protect the base premium which usually goes up after a claim.

 

Correct, but the base premium can be lowered if you opt for a higher excess,

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55 minutes ago, Lutz said:

So, if I understand your reply correctly, no claims discount is only restored if you were not at fault, but if you were, then it doesn't matter whether you pay the full sum of the claim back to the insurance company or not, your no claims bonus would always suffer.

In the UK we aren't normally given the option of reimbursing our insurance company for any sum they have paid out to a third party.   It is a very firmly held view by insurers that the no claims discount is just that, a discount for making no claims not a discount for having no blames.

Edited by Legal Eagle
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19 minutes ago, Legal Eagle said:

In the UK we aren't normally given the option of reimbursing our insurance company for any sum they have paid out to a third party.   It is a very firmly held view by insurers that the no claims discount is just that, a discount for making no claims not a discount for having no blames.

 

Which makes a nonsense of No Claims Discounts as they can be "protected" regardless of claims.

 

Not mentioned so far is the fact that NCDs can be built up for each year no claim is made.   Subsequently making a claim reduces the NCD in steps.   A  9 year NCD may be worth 79% discount on the base premium  so is worth protecting despite the extra cost of NCD protection.

Is it correct that reimbursing your insurer for any payments it has made to a third party is not possible?  I've never heard of it but can it be done? One problem is that even minor damage repairs are very expensive so perhaps it is not a practical proposition anyway? 

Perhaps Lutz can tell us why one would do so in Germany?

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Personally I wouldn’t entertain an option to reimburse an Insurance Company for their costs (if such an option were available). I would rather pay the 3rd party direct.

Repair costs are generally loaded when an Insurance Company is involved so why pay the inflated cost.

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I'm glad I'm insured with a German company then. At least the base premium never changes, no matter how many accidents one has had. Only the no claims bonus is reduced as a result.

There's an app available where one can calculate when it becomes viable to pay a third party claim out of one's own pocket. It takes the reduction in no claims discount in future years into account as well. In my case, if I enter all the details, it tells me that all claims under €1700 are best settled privately (as I am currently already down to 75% no claims discount).

Edited by Lutz

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2 hours ago, Paul_B said:

 

Correct, but the base premium can be lowered if you opt for a higher excess,

 

Yes - but excesses are just a half-way house between third-party and fully comprehensive - personally I just have the mandatory £100 and no voluntary excess.

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41 minutes ago, Black Grouse said:

 

Yes - but excesses are just a half-way house between third-party and fully comprehensive - personally I just have the mandatory £100 and no voluntary excess.

 

How do you arrive at that very odd conclusion?

 

If you are involved in a collision that is your fault  Third Party insurance pays for the other car, Fully Comprehensive insurance pays for damage to your car.

It has nothing to do with insurance excess, which is a trade off where by you pay a higher excess for a lower insurance premium, which only costs you if you have reason to make a claim and if you don't claim, you pay a lower premium than if you had opted to pay no excess.

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3 hours ago, Grandpa Steve said:

 

How do you arrive at that very odd conclusion?

 

If you are involved in a collision that is your fault  Third Party insurance pays for the other car, Fully Comprehensive insurance pays for damage to your car.

It has nothing to do with insurance excess, which is a trade off where by you pay a higher excess for a lower insurance premium, which only costs you if you have reason to make a claim and if you don't claim, you pay a lower premium than if you had opted to pay no excess.

 

Your insurer will always pay third party costs - the use, or avoidance, of excesses on a fully comp policy just varies the amount they pay for your own damage.

 

In practice the repair cost at which it's economic to claim is much higher than the excess as the effect on NCD and future premiums needs to be taken into account.

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I had an accident about 20 years ago now where a bloke hit me in a car park. He admitted liability. Following morning before i had a chance to call my insurers, his insurance company called me &took over handling the repairs from start to finish. They even mot'd it as it became due  while in for repair and due to damage to the light cluster it would have failed if I'd taken it in prior to the repair being completed.  

When my renewal came through some months later the premium had gone down.  

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