Home insurance: no claims discount
Most home insurance providers will reward you with a no claims discount (NCD) if you go for a year or more without making a claim on your policy.
The reduction after one year is often up to 30%, while those who do not make a claim for five or more years, can NCDs qualify for up to an incredible 70% of their home insurance premium.
Keeping your no claims discount
The savings on offer mean that it can sometimes be worth paying for say accidental damage to your belongings, or a small theft, yourself - rather than making a claim.
After all, even a small claim can wipe out your entire NCD, and the extra you have to pay as a result could easily mean you lose out overall (especially as you will have to pay the excess towards the cost of any claim).
The good news, however, is that most home insurance providers will offer new customers an NCD based on their claims record with their previous insurer (or insurers). This means you can keep benefiting from your no claims discount while shopping around for the best deal on your home insurance.
If you have buildings and contents cover with the same insurer, it is also worth knowing that a claim on one policy should not affect your NCD on the other one. That said, it is a good idea to check the small print before making a claim, just in case.
As NCDs are in the policyholder's name, couples should also protect themselves by taking out their insurance in joint names.
Protecting your no claims discount
Once you have a clean claims record lasting for at least four years, some insurance companies will allow you to protect the NCD you have built up as a result.
You will have to pay for this but it could prove worthwhile, as it will mean that you can make one or more small claims without endangering the discount you have accumulated over the years.
The other way to protect your NCD, of course, is to avoid making a claim on your home insurance
The other way to protect your NCD, of course, is to avoid making a claim on your home insurance. Steps that you can take to do this include improving your home security by installing a burglar alarm and window locks and insulating pipes and tanks so that they do not freeze in the winter.
Those living in flood risk areas should also look at investing in flood prevention products such as sandbags to reduce the likelihood of floodwater making it into their homes.