How do household no-claim discounts work?

If you drive a car you will know what a no-claims discount (NCD) is, but what you may not know is whether you can get the equivalent for your home and whether they work in the same way. 

Here we detail what a NCD is for your property and how they work.

Does home insurance offer a no-claims discount?

The good news is you can earn a no-claims discount (NCD) on your home insurance the same way you build up your car insurance. If you do not make a claim during the policy term, it saves your insurer money. Earning an NCD is an incentive to not claim for small incidents. 

However, making a claim on your home insurance will affect your NCD, just like your motor vehicle policy.

How can I get a no-claims discount on my home insurance?

When you apply for a new quote, you’ll usually be asked how many years of NCD you’ve built up. If you’re not asked, make sure you raise it with one of our specialists. 

Your NCD will then be used to calculate the new premium quote, and in some cases, an insurer might want to see proof of your claim-free years. You can get this from your existing insurer if you do not have anything in writing, or are unsure if you have built up any years. 

Is a no-claims discount for my home the same as for my car?

If you go without making a claim on your home insurance for a year, you can get a discount on the cost of your insurance at the renewal stage. This discount will grow for each year that you remain claim-free, up to a maximum discount.

The one key difference in the way an NCD on car and home insurance works is that with your car insurance, your NCD is only affected by claims that are your fault, or if the cost of repair can’t be claimed from another party. Non-fault claims do not affect your NCD.

However, with home insurance, both fault and non-fault claims are treated the same. So even if your claim is not your fault due to something like a burglary or if you make a claim over an accident, like smashing your TV or spilling wine on your sofa, they will be treated in the same way regarding your NCD.      

What happens to my no-claims discount if I make a claim?

It depends on the insurer and over how many years you’ve built up your NCD. You could lose your NCD altogether, or see it reduced if you make a claim.

Because of this, you may decide you’re better off not making a claim for a small amount and paying for the repair or replacement yourself, such as in the examples previously mentioned.  

You will also want to factor in how much excess you’ll need to pay when making a claim -if it’s more than it would cost you to pay out of your own pocket, it’s not worth it.

For bigger claims, such as a flood or fire which can cost thousands of pounds worth of damage, or if you’re burgled and have lost lots of valuable items, it would make financial sense to make a claim, even though you’ll lose your NCD or see it reduced. 

How can I reduce the chances of having to make a claim on my house insurance?

Sandbags Outside Front Door Of Flooded House

There’s plenty you can do to minimise the chances of having to make a claim on your home insurance – and avoid disruption while repairs are being made. 

Here are a few ways you can do that:.  

Take good care of your home

While your home insurance will not cover you for wear and tear on your property or its contents, it’s still important to keep on top of general home maintenance. Small problems can become bigger issues if they are left ignored.

Protect your home from weather damage. Check for things like loose roof tiles, broken gutters and leaky windows after bad weather. If you have trees near or overhanging your property try to keep the branches maintained. 

Ensure your boiler has an annual check. Whilst you may feel there’s nothing wrong with your boiler, plumbers can detect early signs of leaks and drips and make sure the pipes are well-insulated to save you money in the long run.

Improve your home’s security

Installing a home security system will help to deter burglars from visiting your home if they can see that one is installed. Burglar alarms, security lighting, approved locks on external doors and windows and a doorbell with a camera will not only show your home is well guarded but can also reduce the price of your home insurance.

If you are going to be away from your home it’s also a good idea to use timers to turn your lights on in your property to give the effect that someone is at home. 

Protect against house fires

Fitting a fire alarm on each floor of your property can reduce your home insurance, but it will also ensure you and the people you live with will be notified if there is a fire even when you are asleep. It is a good idea to have a carbon monoxide alarm installed too. 

Keep matches, lighters and candles away from electrical items and from children, even when stored.

Be careful with DIY jobs

Be careful with the DIY jobs that you do in your home, and who you pay to carry out work in your property. Ensure the workmen you hire have the correct qualifications needed, along with all the paperwork. 

It’s also worth noting that any work carried out may require you to have home renovation insurance  

If you do not have accidental damage included on your buildings insurance, you’re unlikely to be covered for any DIY mishaps either.

Does my no-claims discount cover both my contents and buildings insurance policies? 

It varies between insurers, but you might get the chance to build up an NCD on both your buildings and contents policies.

Does it matter if I’ve not had home insurance for a while?

Insurers will be looking at how many years of no-claims you’ve had when calculating the price of your home insurance. If you have had a gap in your cover, whether that’s due to renting in between moving properties or any other reason, you may not be able to receive the full discount from your no-claims discount, depending on the time, usually around three months, in between your home cover. 

Home insurance you can trust

If you’re looking for home insurance, there’s the specialist home insurance providers at Adrian Flux. We can protect you financially against incidents that take place while the building work is underway, including fire, theft, injury and accidental damage. We can also cover your property if it remains unoccupied during renovations.

For our best rates, call 0800 369 8590 or book a callback at a time that works for you.