Before we start, this article is about helping you not get scammed, and isn’t inspiration for fraud… OK, on we go.
We get it, everyone is after that sweet No Claim Discount (NCD). It can make your otherwise eye-watering car insurance premium a lot more palatable, can’t it?
People with five years of NCD could get up to 70% off their insurance policies. How’s that for a sweet deal in the middle of a cost-of-living crisis?
But the thing is, a fake No Claim Discount Certificate is just a manufactured version of something that doesn’t actually exist.
Nobody can sell you a fake No Claim Discount Certificate because the NCD isn’t something you can buy.
Confused yet? Read on to find out exactly what we mean.
What is a No Claim Discount?
You might be wondering what exactly a No Claim Discount is and what it entitles you to.
A No Claim Discount is an entitlement you build up over a period of years of driving a car without having claims. When you’re a new driver, your insurance premium tends to be on the higher side because insurers don’t know yet whether you’re likely to make lots of claims.
But if you drive carefully and don’t make any claims, you start building up your No Claim Discount, which is sometimes known as a No Claim Bonus. This builds up on an annual basis though, so it can take a while to see the benefits.
This is where people try to fast-track the process by buying a fake certificate. But that’s a biiiiiiiiiig no-no. And we’ll tell you exactly why.
Why can’t I just buy a No Claim Discount Certificate?
You might be wondering why you can’t just buy yourself a No Claim Discount certificate. The short answer is: because there’s no such thing. Fake or otherwise.
What you will get after a year with your insurer is a Proof of No Claim Discount or Proof of No Claim Bonus. This will have your name, your insurer’s details, and the number of NCD years you’ve earned.
You can use this to get a discount when you buy insurance elsewhere. But that’s it. There’s no other way to go about it.
If anyone claims they can sell you a No Claim Discount Certificate or similar, they’re a scammer. They’re only issued by insurers after you’ve earned them.
If you pay to get one off some random dude who claims his mate can sell you one, you’ll waste your money because it’ll be completely worthless. Also, you’ll likely get into a lot of trouble with your insurer.
By the way, there are lots of insurance scams out there, so stay vigilant! We’ve covered ghost broker scammers here and crash for cash scams here.
Who sells No Claim Discount Certificates?
Nobody can legally sell you a No Claim Discount Certificate. But, scammers operate on social media platforms and instant messaging services and pretend they can.
They’ll offer to sell you a certificate and then promptly disappear once they’ve taken your money in exchange for a worthless document.
So next time some shady dude tells you to “trust me bro” on WhatsApp, maybe don’t.
These people tend to target drivers who struggle to get car insurance or who’ll need to pay high premiums. So be on the lookout if you’re a newly qualified driver, if you have lots of points on your license, or if you’ve just arrived in the UK.
What happens if I use a fake No Claim Discount Certificate?
Okay, so you’ve wasted your money on a completely useless fake No Claim Discount Certificate.
You know it probably won’t work, but you might want to try it anyway. You’ve paid for it anyway, so why let it go to waste, right?
Wrong!!!
Don’t do it! Turn back before you cause some irreparable damage!
If you do it, what will most likely happen is, your insurance provider’s fraud detection and prevention control alarm bells will start ringing.
It’s incredibly easy for an insurer to check whether you’re telling the truth. For one, the Motor Insurance Bureau has an online NCD database that allows insurers to quickly verify your NCD information. You can also AskMID to check whether a car is insured.
They could do this when they offer you a quote, when you pay for your insurance, or even when you make a claim.
If they catch you, which they most likely will, you’ll get the brunt of the consequences. They’ll likely cancel your policy and refuse a renewal. They would usually be well within their rights not to pay out any claims you’ve made, or to reduce the amount paid out at the very least.
A refusal to renew will need to be declared to other insurers in the future, which will make it very hard for you to land car insurance again. If you do find an insurer willing to work with you, expect to pay through the nose for the privilege.
As we said, it’s just not worth it.
What do I do if I think I’ve been scammed?
If you bought a fake No Claim Discount Certificate, you’re probably kicking yourself right about now. Look, if you’ve just bought it and haven’t tried to get insurance with it, it’s not that bad.
The bad news is, you can pretty much say goodbye to the money you lost. While you could absolutely report it to the Insurance Fraud Bureau, chances are you won’t see your cash again.
But, if you ended up buying insurance with the No Claim Discount Certificate, things just got a little bit complicated, sadly.
You obviously need to tell your insurer.
Call them, explain the situation, and hope for the best. Maybe grovel.
What are the consequences of using a fake No Claim Discount Certificate?
You may not realise it, but if you’ve used a fake No Claim Discount Certificate, you’ve essentially lied to your insurer.
They may ask you to pay an additional premium as you do not actually have a No Claim Discount so this shouldn’t have been applied in the first place. They’re also well within their right to ask you to cancel the policy or even forcibly cancel the policy on their side. This is not great, obviously.
If your insurance is cancelled by your insurer, you’ill probably struggle to find an insurer who will insure you again. When you do, expect to pay high premiums for a while. Unfortunately, fake NCD Certificates usually end up being completely counter-productive after all.
While you could report the matter to the Financial Ombudsman if you feel you’ve been treated unfairly by your insurer, they will usually side with the insurer if they find you’ve misrepresented information about yourself.
You could also report it to the Insurance Fraud Bureau – anonymously if you like. This is probably a good idea because it’ll prevent other people from falling for the same scam twice.
Wait, what about No Claim Discount protection?
Okay, but people can buy No Claim Discount protection, right? How’s that different from buying your NCD entitlement in the first place, you might be wondering.
Well, there are a couple of key differences here.
First, let’s define what No Claim Discount protection actually means. NCD protection usually means you can pay for additional coverage as part of your car insurance policy which will protect your existing No Claim Discount if you need to make a claim.
But, this type of cover usually comes with caveats, including age restrictions and a certain number of NCD years accrued already.
Importantly, this type of cover is designed to protect the no-claim years you have earned. If you want to find out more about building and protecting your NCD the right way, make sure you check out our article here.
Buying a fake No Claim Discount Certificate
Hopefully, by now you realise that buying a fake No Claim Discount Certificate is a big no-no. And you know what steps to take if you have fallen prey to this awful scam.
Paying for a fake No Claim Discount Certificate if it means you’ll get a massive discount on your car insurance might seem enticing. You may not have even realised it’s wrong, after all, it’s just a service you’re paying for.
Sadly, scammers prey on people who want cheap car insurance policies. But the damage they create can be lasting. You won’t just lose out financially in the short term. You might be forced to pay higher premiums for years to come.
If you’ve been involved in a scam, it’s best to come clean and pay what you owe. Then, pursue the scammer through the proper channels.
