Choosing the best car insurance company for your needs can be a tricky business. However, since no two policies are alike, it is important to do your homework before signing any contracts.

One thing you should be on the lookout for is the exclusions you could include in your policy that won’t have an impact on your no claims bonus.

What is a no-claims bonus?

If you do not have any need to make a claim under your policy, you might be entitled to a discount. This is known as a “no claims bonus” or “accident free discount”.

To be eligible for this kind of discount, you may need to have held your car insurance policy for a certain length of time.

However, some insurers will let it flow from a previous insurer to your current policy, making it easy to switch over as there won’t be any penalties.

If you do need to make a claim, you may lose some of your no claims bonus. As a result your car insurance premiums may increase,

What additions can you get that won’t impact your no claims bonus?

Some insurers will take it into account if you claim for a broken car windscreen or window or need to get your keys and locks changed.

This means if you get make a claim to replace your car windscreen or window your insurer won’t need to count this as an incident. Some providers – such as Co-op Insurance NZ – will not charge extra for including windscreen/window cover services as part of your comprehensive car insurance policy and there is no excess to lock in these services when you make a claim. Plus if you do not make a claim you won’t lose your accident free discount.

What is a protected no-claims bonus?

Some providers will offer you the opportunity to protect your no claims bonus. This means one accident will not reduce the maximum no claims discount.

However, this can be a costly exercise. Make sure you weigh up the pros and cons of taking such a step, While it allows you to make one claim without being penalised, if you need to make an additional claim, you could lose your entire discount.