Why would a no claims bonus be reduced?
If a no claims bonus has been sent in from the customer that is less than what the customer selected/advised and there is no other reason for it (e.g. missing some years from a prior insurer and need to get that), then we need to amend the no claims bonus on risk to match the proof.
- If the NCB is one to five years and differs from the proof, there will be an additional premium to pay (e.g. client selected/advised four years but their NCB proof states three years).
- Some insurers may not apply an additional premium for the NCB being different if it is over five years (e.g. client quoted on seven years NCB and they only have proof of six) so we can make this mid-term adjustment without an additional premium being applied if that insurer caps their discount at five years (some insurers cap at nine years so there may be an additional premium that needs applied).
- Some no claims bonus may be more than nine years but generally no insurers give any more discount after nine years.
- Always check claims history if the no claims bonus sent in is less than what the customer has selected/advised.
Chat responses - Reducing an NCB
Why are you reducing my no claims bonus?
The insurer has requested further evidence of your NCB as the number of years declared is greater the proof received and we have not received this. This is going to result in an additional premium of x
The insurer has requested further evidence of your NCB as the number of years declared is greater the proof received and we have not received this. This will not affect your premium but we will have to reduce your no claims bonus to match the proof.
The insurer needs to reduce your no claims bonus as it does not match the proof that was sent in. In order for you to stay on cover, this needs to be match for the insurance to be valid.
Why would a no claims bonus be removed?
- If the insurer does not receive proof of the no claims bonus in the required time frame, then the discount they applied must be removed to stay on cover. The no claims bonus needs amended to 0, this will always result in an additional premium for any insurer.
- A customer may have selected/advised they have a bonus of e.g. two years but because of a fault claim, their previous insurer stepped back their bonus and they may now be back to 0 years. Customer may not have been aware this would happen when proceeding with our cover.
- Some insurers may not quote for a policy with no bonus so these cases will need to be cancelled or quoted with another insurer who does quote for 0 no claims bonus.
Chat Responses - Removing a car policy bonus
Why are you reducing my no claims discount?
The insurer needs proof of your no claims bonus as they have applied discount to your price based on this. As you have not supplied the proof, your no claims bonus needs to be reduced to stay on cover and for the insurance to be valid.
The no claims bonus you sent in states that you have 0 years no claims bonus which is what your cover must match. We need to reduce your no claims bonus for the cover to stay in place.
Why are you cancelling my policy?
The insurer needs proof of your no claims bonus as they have applied discount to your price based on this. As you have not supplied the proof of your no claims bonus within the required timeframe, your no claims bonus needs to be reduced to 0. Unfortunately, this insurance company does not quote for 0 no claims bonus and therefore your policy is required to be cancelled.
Introductory Bonus:
If a customer has purchased a policy with an introductory bonus declared, this may need to be adjusted depending on whether or not proof of NDE is received, and if that proof reflects what was declared during the quotation process.
What to look out for when validating an introductory bonus:
- Break in Cover: The cover must be consecutive years with no break in cover for more than 30 days (e.g. cannot be six months driving experience on mum’s policy then the next year 6 months driving experience on dad’s policy).
- Multiple Previous Insurers: If the driving experience is based on being a named driver on the same policy/vehicle but it has been with different insurers over the last few years, then the customer is required to get proof from the different insurers. Named driving experience does not follow you the way a no claims bonus does.
- Intro bonus – Cannot Protect: You cannot protect an intro bonus; you have to have at least five years no claims bonus earned in your own name before you can protect (except for a very small number of insurance companies that allow bonus protection at four years claims free years).
- Least Experienced Driver: An intro bonus is rated off the least experienced driver e.g. if a husband takes out a second car policy in his name and adds his wife as a second driver who has held her licence for a year, then we can only allow one year intro bonus as the wife is the least experienced driver. This helps prevent cases of fronting.
- Previous Claim – At Fault: Unlike an earned bonus, if the customer has had a fault accident, they start over from the date of the accident and the intro bonus is earned from there (on an earned bonus the bonus may be stepped back two years or none if it is protected).
- Previous Claim – Non Fault: If the customer (the named driver) is using intro bonus from a policy that has had a claim but it wasn’t the customer that had the claim, then you can still allow the intro bonus.
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Required Validation: Similar to the a proof of a no claims bonus, the proof of driving experience must include:
- The name of the customer and confirmation that they were a named driver on an insurance policy.
- The name of that policyholder and registration of the car that the customer was a named driver on.
- Policy number and insurance company the named driving experience is coming from.
- Date of inception of the policy and the expiration (if applicable as this policy can still be live unlike a earned no claims bonus where it needs to be expired to use on the new policy).
- If the intro bonus is coming from a company car, this needs to be confirmed in a letter from that insurance company or from the customer’s company (on their letterhead paper and signed) with the information above included.
- If the customer is taking out a second car policy (so their bonus is live on another policy), the customer will need to get written proof of this from that insurance company.
Further proof of driving experience required
If there are dates missing / gaps in the driving experience for more than 30 days, the insurance company will not accept the intro bonus.
The customer needs to provide further proof of the driving experience for the insurance company to be able to stand over the discount that has been applied and for the cover to be valid.
Proof of Introductory Bonus doesn't match what has been declared
If the proof of driving experience doesn’t match what the customer has selected/advised and they can’t provide the correct documentation, then the insurer will have to reduce the driving experience (discount) allowed to match the proof.
This will often result in an additional premium and in some cases, it may mean the policy is cancelled. This may be the case if the insurance company does not accept the amended number of driving experience years (e.g. customer advised three years driving experience but can only provide proof of one and the insurer does not quote for one year intro bonus).
Chat Responses - Why is proof of introductory bonus required?
Why do you require further proof of driving experience?
The insurer has requested further proof of your driving experience as the documentation you have sent through does not match the number of years you advised them of when the policy was purchased.
The insurer has requested further proof of your driving experience as the documentation you have sent through does not match the details on the insurance policy.
The insurer has requested further proof of your driving experience as the documentation dates you have sent through do not match the details that were advised when the policy was purchased.