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Car insurance: do I need to protect my no-claims bonus?
Car insurance offers the option of protecting your bonus. Is it worth it? What are the advantages and costs, and when does it pay off? Comparis answers the key questions.
24.02.2022
iStockphoto/AndreyPopov
1. What is no-claims bonus protection?
Car insurers in Switzerland use a bonus system to calculate your individual premium. This means that if you cause damage, your premium rises. With bonus protection you can prevent the premium going up after a claim. Depending on the product, you can make one claim per year, or even several, without having to worry about a major increase in your regular costs.
How bonus levels affect premium increases after a claim
Insurers move you to a higher bonus level after you have made a claim. This also increases your premium in the next insurance year. The higher the bonus level, the more your insurance costs. If you haven't had an accident for a long time, you will move to a lower bonus level.
Protecting your no-claims bonus is your choice. You can take it out as an additional service as part of your liability or collision casco insurance.The products offered by the individual insurance providers vary considerably, however. This is why it pays to compare so that you can save money and avoid nasty surprises.
2. What does protecting my bonus cost?
Cover for your no-claims bonus doesn't exactly come cheap, especially as it is usually based on the policyholder's current bonus level. In other words, the higher your current bonus level, the more expensive protecting your no-claims bonus will be.
With premiums expensive enough, many people choose to forego this add-on. You will face certain costs if you make a claim, however. In addition to the insurance excess, your premiums will also go up.
It's worth knowing that this increase will be much more than the extra premium that you pay for bonus protection, so the additional cover will be worth it for most policyholders.
Options for switching insurance after a claim
Didn't take out bonus protection and just had to claim? If your car insurance will pay for the damage and has already officially notified you, it's a good time to switch insurer. You can cancel your policy within 14 days of notification.
It's important to compare premiums, however. Check that other insurers will accept you, and on what terms.
This article was first published on 11.02.2019