No claims bonus is awarded to you for every annual insurance policy claim free year. The more no claims bonus you have the greater the discount you are likely to receive against your insurance premium. Typically discount is capped at around 65% but some policies reward you for more.

In the event of a claim being made against your insurance policy where your no claims bonus is not protected your discount may be affected. Typically for every claim made during the duration of an insurance policy year your no claims bonus will be reduced by two years. This varies for each individual insurer and you should always read the terms and conditions of the policy.

Once you reach the maximum no claims bonus you may wish to protect your discount. By doing this the insurer will allow you to make a few claims without losing your no claims bonus. There will be a charge for this benefit and you should check the terms and conditions of the insurer. The number of claims you are allowed to make varies for each individual insurer, but usually its either two claims in three years or two in five years.