What is no claims discount?

No Claims Discount Explained

A no claims discount (NCD), also known as a no claims bonus, is one of the simplest ways to save on your car insurance. It’s a reward for safe driving, and the longer you go without making a claim, the bigger your discount can be. 

In this guide, we’ll explain exactly how a no claims discount works, how to protect it, and how much it could save you over time.

What you’ll learn in this guide:

• What a no claims discount is and who can get one

• How no claims bonuses are built up over time

• What happens to your NCD after a claim or accident

• How no claims discount protection works

• How 1st Central can help you make the most of your NCD

At 1st Central, we offer no claims discount protection - so you can keep your hard-earned bonus even if you need to make a claim.

What is a No Claims Discount (NCD)?

A no claims discount is a reduction on your car insurance premium that you earn for every year you drive without making a claim. The more claim-free years you build up, the bigger your discount could be.

It’s important to know that:

• Only the main policyholder earns a no claims bonus - not named drivers.

• Not all insurers calculate the discount in the same way.

• Some may cap the maximum discount you can earn.

• Your no claims bonus can only be used on one car.

If you’re switching insurers, you can usually transfer your NCD over, just make sure you have proof from your current provider.

How Does It Work – and How Long Does a No Claims Bonus Last?

You earn your no claims discount by not making a claim on your car insurance each year.

Here’s how it works:

• Each 12 months of claim-free driving adds another year to your NCD.

• The more years you build up, the more you could be discounted on your premium.

If you take a break from driving, most insurers will honour your no claims discount for up to two years, after that, it may expire, and you’ll likely have to start again.

So if you’re not driving for a while, it’s worth checking how long your NCD will stay valid with your current provider.

Does Making a Claim Affect Your No Claims Bonus?

Yes, making a claim usually reduces or resets your no claims discount, unless you’ve added protection to your policy.

Here’s what you need to know:

• Fault claims (where you're responsible or no one can be found at fault) usually result in a loss of some or all of your NCD.

• Non-fault claims (where another driver is clearly at fault) may not impact your NCD—but only if your insurer can recover the full cost from the other party.

At 1st Central, we offer no claims discount protection - a simple optional extra that helps you keep your bonus even if you need to make a claim. We believe safe drivers should still be rewarded 

How to Protect Your No Claims Bonus

No claims discount protection is an optional extra that helps keep your NCD intact after a claim.

Here’s how it works:

• For many providers, you’ll need to have built up at least 3 years of no claims to be eligible. At 1st Central, we provide access to our no claims discount protection after 1 year of no claims. 

• If you make a claim, your NCD won’t drop - even if your premium increases.

With some insurers, NCD protection is limited to a certain number of claims before it is removed. At 1st Central, your NCD remains protected no matter how many claims you make.

This doesn’t mean your overall insurance cost will stay the same, but it protects the discount itself, which could help keep future premiums lower.

1st Central offers no claims discount protection because we know how hard you’ve worked to earn it. For a small additional cost, it could save you money in the long run.

Make the Most of Your NCD with 1st Central

A no claims discount can make a real difference to the cost of your car insurance - but only if you know how to look after it.

With 1st Central, you can:

• Choose to protect your NCD at the start of each policy year and avoid losing your discount after a claim

• Easily transfer your no claims bonus from another provider

• Get clear, upfront policy terms so you always know where you stand

Want to see how much your no claims bonus could save you? Get a quote from 1st Central and find out today.

FAQs

Is a no claims discount the same as a bonus?

Yes, they’re two names for the same thing. No claims discount (NCD) and no claims bonus (NCB) both refer to the discount you get for not making a claim on your car insurance.

Can you get NCD as a named driver?

Usually not. Only the main policyholder earns a no claims discount. If you’ve been a named driver on someone else’s policy, you may need to start building your own NCD when you take out your own insurance.

What happens to no claims bonus after an accident?

If you make a claim after an accident, your NCD could be reduced or lost - unless you’ve protected it. Non-fault claims may not affect your NCD if your insurer can recover the costs from the other party.

Can I transfer my no claims discount to a new insurer?

Yes, most insurers accept proof of your no claims bonus when you switch. Just make sure to request written confirmation from your previous provider and share it with your new insurer when applying.

How can I get proof of my no claims bonus?

If you’re switching insurers, you’ll usually need written proof of your no claims discount (NCD). Your current or previous provider can send this to you - often it’s included in your renewal notice or cancellation confirmation. If it’s not, just contact your insurer and ask for written confirmation of your NCD.