No Claim Discount, commonly referred as NCD is a vital part of your car Insurance. The amount of your insurance premium payable or saving is dependent on your NCD entitlement. As the name suggest, this no claim discount is extended to you when you do not make any claim toward your insurance during the in force period. Thus, when you renew your insurance for the next 12 month period, you are entitled to this no claim discount (NCD).
The NCD is tied to your name and not a car. Thus, it is actually transferable. Meaning that if you sell off your car and get yourself a new car, your new car insurance can be applied with your entitled NCD. In the event that you are selling off your old car, remember to cancel that policy as any remaining period covered not used can be refund to you.
Although the name is called No Claim Discount, it does not means you cannot claimed against your own insurance. In the event of an accident, which you are not at fault, you are entitled to claim your own insurance for repair and yet you do not lose your NCD. Your NCD will only be lost if you are involved in an accident and you are at fault, resulting in other parties claiming against you.
Once your insurance has been claimed, you lose your NCD entitlement and it is reverted to zero (0%) – no discount.
But if you have not been involved in any accident, your NCD entitlement will increase over the years. The maximum NCD one can entitle to is 55%. While you can accumulate your NCD over the years, you may also lose your NCD if you do not own or insured your vehicle over the years.
Below is the similar illustration of your NCD entitlement over the years for private vehicles:
First Year – 0%
Second Year – 25%
Third Year – 30%
Forth Year – 38.33%
Firth Year – 45%
Onward – 55%
As for motorcycle and commercial registered vehicles, the NCD rate will be much lower and cap at the max of 25%.
First Year – 0%
Second Year – 15%
Third Year – 20%
Forth Year – 25%
Onward – 25%
If you are not sure of your NCD entitlement, you can actually check it online via this link.
If you have renewed your insurance policy without taking into your NCD entitlement, inform your agent and they will help you to apply your NCD and have the excess payment refund to you.