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Lost no-claims' bonus

Hi, just a query related to car insurance. I had a small claim last year and it hasn't been resolved. I got my renewal quote at five times the cost of my previous policy but cannot get a quote from any other insurance company because i have an open claim. This means my insurance company can name its price and I have no option but pay it. Are there any other options for me. ? Jonathan

Hi Jonathan.  It is clear that your No Claims Bonus has been suspended and it is a No Claims Bonus, not a No Blame Bonus.  If this is a third-party claim (in other words you were involved in an accident with someone else) and the claim is settled in your favour and the insurance company don’t have to pay out, your No Claims Bonus should be re-instated.  If, however, it was a second-party claim – that is, your own damage claim on comprehensive cover – your No Claims Bonus is gone and it will have to be re-built.

 

My advice is to find out what your No Claims Bonus was before you made the claim and calculate is your new premium based on that calculation.  What I am saying is that if you had an 80% No Claims Bonus prior to the accident your premium would increase five-fold with the loss of that bonus.

 

If that calculation doesn’t add up and the premium is still higher than your old premium before the No Claims Bonus, then you are being loaded with an increased risk factor.

 

Legally the insurance company are entitled to do this but the Financial Services Ombudsman which regulates the insurance industry may have a view that this is grossly  unfair, and clearly you would agree with that.  My suggestion is that after doing the math and perhaps approaching the insurance company to ask can they do any better on the premium, if you get no satisfaction contact the Financial Services Ombudsman at www.financialombudsman.ie

 

As an alternative you can use the arbitration clause in your policy to try and have a new premium fixed to your satisfaction. 

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