How does the no-claims bonus system work in car insurance?
In auto insurance, the no-claims-bonus system is designed to reward good driving behaviour and sanction bad behaviour.
A portion of your premium (the premium linked to the Third-Party Liability cover and, in some cases, the premium linked to the Material Damage cover) is calculated according to your no-claims-bonus level.
The highest level is 22 and the lowest is -3:
The basic no-claims-bonus level is 11; it's the one we apply to you when you have no history of auto insurance (so if this is the first time you insure a vehicle), or if you insure an additional vehicle (because you cannot duplicate levels acquired on other vehicles).
Over the years, the level evolves:
- If you did not have an accident for which you are responsible during the year, your level decreases by 1 point, which can lower your premium the following year (see diagram above).
- Conversely, a penalty is applied when you have had an accident for which you are responsible (+3 points), which increases your premium.
Remember that your level stays the same even if you change insurer.
If your old policy is terminated, you just have to ask for a no-claims-bonus certificate from your former insurer for the new insurer to apply the same level.
At AXA, we make a distinction between two no-claims-bonus systems:
- The “Third-Party Liability” system, related to accidents you cause to a third party (managed by legal provisions applicable to all insurers)
- The “Material Damage” system, related to accidents involving damage to your bodywork (only applicable under the formula OptiDrive Privil?g>?ge).
According to your formula, these levels are indicated on each of your bills, to help you follow the evolution of your premium.
