If I Cancel My Car Insurance Do I Lose My No Claims?
Table of Contents
Cancelling your car insurance doesn’t automatically mean losing your no-claims bonus (NCB), but how and when you cancel matters. In short, you keep your no-claims bonus as long as you’ve completed a full 12-month policy year. If you cancel mid-term, you usually won’t earn a new year’s bonus, but you don’t lose the years you’ve already built up.
Key points
How No-Claims Bonuses Work
Your NCB is built up for each full year you’re insured without making a claim. It can lead to significant discounts, sometimes over 60%, on your premium. But insurers have their own rules on when they apply or honour your bonus.
Cancelling Mid-Year: What Happens?
- If you cancel before completing a full 12 months, you typically won’t earn that year’s NCB.
- If you’ve already completed 1+ full policy years before cancellation, those years are still valid.
- Some insurers may offer pro-rata NCB, but this is rare.
So, cancelling early won’t erase past bonuses, it just means you won’t add another year to your total.
How Long Does NCB Last Without Insurance?
If you cancel and go without insurance, your no-claims bonus is usually valid for up to 2 years; after that, many insurers will no longer accept it. To keep it active, you need to take out a new policy before it expires.
What If You Switch Insurers?
If you’re not cancelling completely but just changing providers:
- Your NCB transfers as long as it’s validated with proof (from a renewal letter or cancellation notice)
- Always double-check how many years your new insurer will accept
Do I lose my NCB if I make a claim?
Not always. It depends on whether you have no-claims protection and the nature of the claim.
Can I use my NCB on a second car?
Typically, no, most insurers allow one NCB to be used on one vehicle at a time.
Can I transfer my NCB to a new car?
Yes. Your bonus stays with you, not the vehicle.
How can I prove my NCB after cancellation?
Your insurer should send proof upon cancellation or renewal; keep this to show future insurers.
In Summary
- Cancelling your policy doesn’t wipe your existing NCB, but you may not earn a new year if you cancel mid-term.
- Your NCB remains valid for up to 2 years without active insurance.
- You can transfer your bonus when switching insurers, just request proof.
Managing your no-claims bonus smartly can save you hundreds. Whether you’re switching, cancelling, or just taking a break, know the rules to keep your discount intact.
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