NL
Good preparation is the foundation for a relaxed driving holiday. This also applies to protecting your car insurance no-claims bonus during a holiday trip. Minor damage, such as a scratch in a busy car park abroad, can significantly impact your accumulated discount, leading to years of increased premiums. Discover how to cover this financial risk with a simple action before you depart.
What is a no-claims bonus and why is it important?
Your car insurance premium consists of a basic amount and a discount for the number of years you drive without making a claim. This discount, known as a no-claims bonus (or bonus-malus), rewards careful driving. For every year you don’t make a claim for which you are responsible, you build up a claim-free year. This leads to a higher discount on your premium, which can accumulate to as much as 80%.
When you make a claim for which you are liable, you immediately lose a significant portion of your accumulated claim-free years. In most cases, you lose five claim-free years. This means you drop down the bonus-malus ladder, your discount decreases, and your monthly premium rises considerably. It then takes another five years to return to your previous level. A small post or an awkward parking manoeuvre abroad could cost you hundreds of pounds per year.
‘You simply want the certainty that a small mistake won’t cost you extra money for years.’
The no-claims bonus protector: a smart addition for your trip
Many insurers offer additional cover known as a no-claims bonus protector or bonus protection. For a small monthly fee, often just a few pounds, this cover protects your no-claims bonus in the event of a claim. With a no-claims bonus protector, you can make one claim per insurance year without it affecting your premium discount.
It acts as a financial safety net. You report the damage, it is compensated according to your policy conditions, but you retain the discount you’ve accumulated. Administratively, your claim-free years will decrease, which is relevant if you wish to switch to another insurer. However, as long as you remain with your current insurer, you won’t notice the damage in your wallet. This cover is particularly useful if you have already built up a substantial discount.
When is a no-claims bonus protector worthwhile?
Taking out a no-claims bonus protector is a personal decision, but in certain situations, it is highly recommended:
- You have a high no-claims bonus (more than 50%). The financial disadvantage of a drop is then significant.
- You drive a car with an expensive premium, making a premium increase particularly impactful.
- You are going on a driving holiday to a country where traffic is busier or more unpredictable, such as in Southern Europe.
- You simply want the certainty that a small mistake won’t cost you extra money for years.
Risks abroad and the impact on your insurance
During a road trip or driving holiday abroad, you face different risks than at home. You are less familiar with local traffic rules, the roads are different, and driving attitudes vary. A scratch on a narrow campsite road, a dent from an inattentive driver in a crowded car park, or a post you overlook in an unfamiliar city centre; these are realistic scenarios.
Without a no-claims bonus protector, every at-fault damage becomes a tricky consideration. Is the damage high enough to claim? Keep in mind that your premium will increase in the coming years. Often, you’d rather pay for small damages yourself to maintain your discount. With a protector, you don’t have to make that trade-off. You simply have the damage repaired, with no financial consequences for your premium. Note that damages from, for example, theft, broken windows, fire, or storm usually do not affect your no-claims bonus, even without a protector.
Check your policy before departure
Good preparation is half the battle. Before you travel, check the terms and conditions of your car insurance. Most no-claims bonus protectors are valid throughout Europe, but it’s wise to verify this with your insurer. You cannot take out a no-claims bonus protector retrospectively; this needs to be arranged before any damage occurs. Contact your insurer or check the policy conditions in the app. This way, you can be sure you are well insured and can hit the road with peace of mind.
Also, don’t forget to take your Green Card with you as proof of your insurance abroad. Check if your legal assistance insurance also provides cover for damages outside the Netherlands. Additionally, verify if your insurer offers breakdown assistance abroad, so you can get immediate help if your car breaks down. With this preparation, you can avoid unpleasant surprises on the road.
Frequently asked questions
To check if your current car insurance protects your no-claims bonus during a road trip abroad, you should consult your policy conditions or contact your insurer before departure. Most insurers cover this for international travel, but confirmation is always advisable. A no-claims bonus protector is additional cover that allows one claim per insurance year without losing your discount, although your claim-free years will administratively decrease. Please note: this protector must be taken out before your trip and is not valid retrospectively.
A no-claims bonus protector is additional cover that allows you to make one claim per insurance year without losing your no-claims bonus, although your claim-free years will administratively decrease. This inexpensive option prevents a premium increase and is particularly useful if you have a high discount or are a young driver. It is important to take this out before your trip and to check if your policy covers this for abroad. You can choose which damage falls under the protector if you have multiple claims.
Investing in no-claims protection for a holiday trip can be financially sensible, especially if you have a high no-claims bonus or are a young driver. For a few pounds per year (e.g., £5-£10), you can make one claim per insurance year without losing your discount, which protects you against a significant premium increase. Although your claim-free years will administratively decrease, your accumulated discount remains with your current insurer, and often when switching. Typical benefits include avoiding a premium increase of hundreds of pounds per year after a small damage, which more than compensates for the cost of the protector.
If you pay for minor car damage abroad yourself, this will not affect your no-claims bonus, as no claim is submitted to the insurer. The no-claims bonus is only affected when you make a claim for which you are liable. Exceptions where the no-claims bonus is not affected include windscreen, theft, fire, storm damage, or recovered damage. For minor damages, it is always wise to weigh up whether submitting a claim outweighs the loss of claim-free years and a potential premium increase. A no-claims bonus protector can offer a solution here, as it allows you to make one claim per insurance year without losing your discount.