Consumer win: customer has her no claims discount reinstated

How long should a ‘no claims bonus for life’ last on your car insurance? A Consumer NZ member thought a discount for life meant exactly that. It turns out hers was cancelled when she bought a new car.

June* got in touch with us when she found out her AA Insurance “guaranteed no claims discount for life” had been cancelled.

June first got the no claims discount around 2007, when she had gone 5 years without a claim on her car insurance. She only noticed her discount had disappeared this year, when her premium for car insurance went up 25%.

When June investigated the issue, she discovered AA Insurance had dropped her no claims discount back in 2015 when she sold her initial car and bought a new one. Rather than transferring the benefit to June’s new car, the insurer dropped it.

“I had no idea I had to transfer the old policy to my new car,” she said. “I had assumed all my future cars would be automatically covered by my ‘no claims bonus for life’ for my whole lifetime.”

Turns out ‘life’ is the life of the policy, rather than the customer’s ‘life’ with the insurer.

June thinks this is a “gross misrepresentation”.

Luckily, the AA Insurance representative who handled June’s complaint agreed the discount should have been transferred to the new vehicle and has since reinstated the discount.

When we asked AA Insurance about June’s experience, the insurer explained the Guaranteed No Claims Bonus for Life was discontinued in September 2015. Up until 2011 the benefit was for the customer’s lifetime, if the customer stayed with AA Insurance. After that date, the bonus was changed to the life of the policy, and then in 2015 to the no claims bonus for existing customers only.

The insurer said it communicated these changes with the small number of customers who still have the historical benefit when policies are renewed annually.

Some insurers are dropping their discounts, so chances are, you won’t be able to get one if you change insurance providers.

Multi-policy discounts, where you get a cheaper price for having several policies (for example, car, house, contents) with the same insurer, are also becoming a thing of the past with some insurers.

AA Insurance dropped its multi-policy discount for new and renewing policies from the 28 January 2025. It does offer AA Membership discounts for eligible customers.

However, you’re likely to get a better deal by shopping around, as we found through our recent investigation into car insurance.

Our buying guide can make it easier to compare policies.

What insurers do and don’t offer

A no claims bonus rewards customers who don’t have accidents and therefore don’t make claims. Such customers receive a bonus (essentially a discount) because they’re seen as less risky to insure.

While no claims bonuses used to be a standard feature of car insurance policies, we’ve noticed some insurers are dropping them for new customers.

AA Insurance no longer offers new customers a no claims bonus for comprehensive car policies. However, customers who had the discount before 26 September 2015 and still have a car insurance policy with this insurance company can keep it.

However, some discounts are available for those who have an eligible AA Membership.

Other insurers have also dropped the no claims bonus for new car insurance customers.

• AMI Insurance is no longer offering a no claims bonus on new policies. Multi-policy discounts, for having more than one policy with AMI, are also gone.

• It’s a similar story at State Insurance.

• Multi-policy discounts are still available at Tower and Trade Me Insurance, but their no claim discounts have also gone.

• AMP still offer a no claims discount but doesn’t offer a multi-policy discount.

• MAS still offer both discounts.

• FMG has never offered multi-policy or no claims discounts, instead it looks at a customer’s claims history to determine their policy’s price.

• Cove said it doesn’t strictly offer a no-claims bonus, however, “customers with no recent at-fault claims do get a cheaper price than people who have had recent at-fault claims”. It’s highly likely other insurers do the same.

*Name changed for privacy.

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