A full No Claims Bonus is a useful thing to have, considering it can entitle you up to 75% discount on your car insurance rate. No Claims Bonus is a discount you receive on your car insurance rate, how much discount you receive is based on the number of years you have held car insurance without making a claim.

Considering that your No Claims Bonus rate is probably the biggest factor affecting the cost of your car insurance rate, there is a strong incentive for safe driving. Every year that you don’t make a claim is another year added onto your No Claims Bonus.

In general the more No Claims Bonus years you have, the lower your car insurance rate will be. When you think about it, it makes sense. Car Insurance companies are there to make money, not keep paying out for bad drivers, so they offer an incentive for good driving. When you change car insurance companies your new provider will usually ask you to prove your No Claims Bonus in the form of a renewal letter or a No Claims Bonus certificate.

When you make a claim your car insurance company will generally apply it’s own rules to determine how much to knock back your No Claims Bonus years. Some companies offer to protect your No Claims Bonus for an extra fee or may offer it as standard.