Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

Full Bio →

Written by

Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

Full Bio →

Reviewed by Jeffrey Johnson
Insurance Lawyer

UPDATED: Jul 14, 2021

Advertiser Disclosure

It’s all about you. We want to help you make the right coverage choices.

Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about car insurance. Our goal is to be an objective, third-party resource for everything car insurance-related. We update our site regularly, and all content is reviewed by car insurance experts.

In a nutshell...

  • A no claims bonus (NCB) may be available to driver’s who have not filed claims with their insurance provider in a set amount of time
  • No claims bonuses could reach significant levels of savings
  • A no claims bonus may potentially be retained if the policyholder was not at fault for an accident

Everyone wants to save money on car insurance. No one likes to pay more for anything more than they are required. Whether the item in question is a luxury one or a necessary one, consumers are driven by a desire to save money.

Of course, quality frequently trumps frugality. In other words, paying a little extra for increase quality is reasonable and logical.

Consumers do want quality in their car insurance provider. Characteristics of quality include:

  • Good customer service
  • Fair reviews of claims
  • Expedient settlement payments

Still, consumers do like to save money on car insurance. Consumers often explore the “every angle approach” and try to reduce their premium costs while not dropping coverage levels beyond a comfortable amount.

Car insurance providers understand there is a desire on the part of consumers to save money. Providers open portals to saving money to their loyal customers in many ways. One such way is through the availability of a no claims bonus.

See how much you could save by doing on online car insurance comparison today!

Claims and the No Claims Bonus Explored

A no claims bonus is a rather straight-forward discount. The discount, sometimes abbreviated as NCB, is a reward of sorts to the policyholders who have maintained a problem-free tenure. Such policyholders have not filed any claims.

So, what is a claim?

A claim, in essence, refers to a valid request for compensation from the insurance company after an accident or a mishap. Claims are filed based on the coverage in place on the policy. Liability coverage is at the core of auto insurance policies.

Any person who is at fault for an accident would file a claim for liability coverage when he/she has caused any of the following with a vehicle:

  • Bodily injury
  • Property damage
  • Death

Claims can be filed on expanded coverage as well. Collision insurance could cover damage to your own vehicle in the advent of an accident.

Comprehensive would cover damage if the roof of the car was damaged in terrible weather. Of course, there are other scenarios in which comprehensive claims could be filed.

In short, filing a claim on a policy is the attempt to recover money through the purchased policy. Drivers who have not filed a claim could receive the aforementioned claim discount. Actually, a series of no claim bonuses could be weaved into a policy.

FREE Car Insurance Comparison

Compare quotes from the top car insurance companies and save!

 Secured with SHA-256 Encryption

Cost-Saving Measures and the NCB

Different insurance providers are going to present their own unique requirements and rules for a no claims bonus. Ultimately, there will be a minimum amount of time required for the driver to go without a claim in order to procure a bonus.

The time period could be one year, two years, or more. The amount of the no claims bonus is also going to vary. Again, different insurance companies all have their own rules regarding how discounts are crafted and offered.

Data indicates no claims bonuses could start at 20 percent and increase year-after-year as long as no claims are filed. Receiving a discount of up to 50 percent on a policy is not out of the question.

Needless to say, discounts this generous could make even the most comprehensive insurance policy very affordable.

Purchasing $300,000 in liability insurance, something previously out of the budget of a driver, may end up being not very much more costly than buying a policy with the state-mandated minimum amount.

Clearly, there is a huge incentive here for drivers to take great care when they are out on the road and also how they store and park their vehicles.

Motivations and the No Claims Bonus


Insurance companies want to hold onto drivers who are not costing them money. Insurance companies require a large pool of money to be held in escrow in order to pay out on claims.

In other words, those drivers who pay into the insurance system and never request a payout are very valuable to the insurance companies. They are so valuable, the insurance companies will cut premium rates drastically to keep them.

Another great benefit is gained when someone goes a long time without an accident: no one gets hurt.

Careful drivers are safe drivers. Accidents can cause great harm to others. When a bonus discount is put in place, drivers end up with an incentive to always show great care when driving on the road.

Many serious accidents can be avoided simply by drivers being more careful.

FREE Car Insurance Comparison

Compare quotes from the top car insurance companies and save!

 Secured with SHA-256 Encryption

Losing the No Claims Bonus

What happens when a driver is at fault for an accident and files a claim? More than likely, the no claims bonus is wiped away.

Even the most careful drivers make mistakes. The penalty for making a mistake here would be the loss of the valuable no claims bonus.

Depending on the insurance company, the clock may reset on the no claims bonus. That is to say, some time will need to pass before the no claims bonus goes into effect once again.

Inquire with the insurance company in order to determine the rules for becoming eligible again.

FREE Car Insurance Comparison

Compare quotes from the top car insurance companies and save!

 Secured with SHA-256 Encryption

The Other Driver’s Fault


Accidents can be categorized as your fault or the other driver’s fault. Someone who has been awarded a no claims bonus who is involved in an accident due solely to the fault of another driver may still be able to retain his/her bonus.

If a driver was intoxicated and caused an accident, for example, the injured party’s insurance company likely will sue the insurance company of the other driver. This is just how the insurance world works.

Those with comprehensive coverage do need to be extra careful, though. One hail storm that hits a car parked in a bad spot may lead to a claim and a loss of a discount.

Always Seek Bonuses and Discounts

Car owners should always look for as many ways to reasonably save money on an auto insurance policy. Taking defensive driving courses and looking for an employer or union-related discounts are common ways to do so.

Performing detailed comparison shopping steps to determine what bonus discounts the insurance company presents is another option. For good drivers who are careful on the road, a no claims bonus is definitely worth taking advantage of.

Compare car insurance options today to find the best deal for your coverage needs.