Motor Insurance Terms Explained:

Full No Claims Bonus Protection

Your insurer will often give you the option to protect your no claims bonus for an additional fee onto your premium. This means that by paying to have your no claims protected, in the event of a claim against your own insurance, you will not lose any of your years of no claim which you have built up. In turn, this means that the discount you receive from your insurer will be protected in the event of a claim. It is worth keeping in mind and reading the small print of your policy documents for any exclusions or limitations on your policy regarding no claims bonus protection.

Sometimes, your insurer may protect your no claims only up to the value of a certain amount or for a number of claims per year. For example you may be protected if you make up to two claims in three years only up to a certain value; if you exceed this amount then you may lose your no claims discount. Make sure you read your policy documents thoroughly and are fully aware of the limitations.

Step Back Bonus Protection

We will  often be asked what step back bonus protection actually means. Simply put, it means that if you make a claim or someone else makes a claim against you, you will lose part of your no claims bonus. For example if your no claims discount is 50% and you have a claim, then it could step back to a lower percentage, such as 30%, thus giving you less years no claims to avail of higher discounts on your policy. Usually you can lose two years no claims, so you may go from 6 years claim free 'stepped back' to 4 years and this in turn will affect your no claims discount.

The main things to remember when you are getting a quote for your motor insurance is to be honest with your insurance company as we have pointed out previously. Don't over exaggerate your years no claims to try and get a cheaper premium as you will have to produce proof of your no claims from your previous insurer.

Can you keep my no claims bonus if I don't own insurance for a period of time?

If you move abroad or sell your car and don't have insurance in your own name for a period of time, some insurers may not honour your no claims bonus when you re-apply for cover if this period exceeds a certain amount of time, such as 2 years. Check with your insurance provider to see where you stand on this matter.

Policy Excess:

The excess amount on your policy is the amount of money which you must pay should you have a valid claim. Your policy will only provide cover above this amount.

Insurance Cover

There are 3 levels of Primary Cover available:

Third Party Only

This is the minimum level of cover required on all motor vehicles used on public roads. This provides cover for injury to other people and damage to others property arising from the use of your car.

Third Party, Fire & Theft

This cover combines Third Party cover (as mentioned above) along with the extra covers of Theft and Fire.

Comprehensive

This is the highest form of protection available, offering Third Party cover along with Fire, Theft and Accidental Damage.

Breakdown Assistance

Using this breakdown assistance will not affect your no-claims bonus.

Benefits:

If you cannot drive the vehicle as a result of a breakdown, your company will arrange and pay for:

• One hour’s labour at the roadside or at your home; and
• Towing the vehicle to the nearest competent repairer or to a garage of your choice, whichever is closer.

Driving Other Cars

Some insurers will automatically provide you with Third Party cover when you drive a car someone else owns, providing you hold a current full EU or Irish driving licence. This cover is only available to you, the policyholder, and not to any named drivers on your policy.

Refused Motor Insurance

An insurance company can refuse to sell you motor insurance as long as they are not in breach of equality law. However, if you ask for an explanation, they must write and tell you why.

If you are refused cover by three or more companies you can contact the Declined Cases Committee of Insurance Ireland. They will get an insurance quote for you (usually the first company you approached will be asked to quote) unless there are good public policy reasons why you should not be given motor insurance. It is important that you keep note of the order in which you looked for quotes.

Before the committee considers your case, you must first have been refused a quote in writing from at least three insurance companies. You can also contact the Declined Cases Committee in cases where you feel a quote is too high or the conditions attached are so severe that it amounts to a refusal to give you insurance.