Question of the week: What to do about a downgrade of the car insurance?

Image result for car insuranceMany motorists regularly enjoy their declining contributions for motor insurance. Because the longer they get through the traffic without an accident, the cheaper their policy will be because of the high damage-free class. However, Stiftung Warentest confirms in the current edition of the “Finanztest” (03/2018) that this paper can turn very quickly.

Those who drive regularly should consider their options in future and consider whether and when to turn on their insurance for claim settlement after an accident. As soon as she steps in, the customer in the SF class is often graduated by several rather than one . That means a huge increase in annual costs for him. But how can drivers handle this downgrade in car insurance?

Car liability insurance is compulsory for all motorists

Car liability insurance is compulsory for every driver and covers potential costs incurred in the accident. For example, how much the contribution for the insurance is made depends on the type of vehicle and the place of residence of the driver. But age, occupation and the annual mileage determine how much the customer spends on his insurance. For each accident-free year, he is also promoted to the non-infringement category and benefits from a rising no-claim bonus .

Caution: Downgrading causes higher annual fees

The contributions of motor insurance vary widely. When choosing the optimal fare, the driver should always pay attention to how many steps he is downgraded in an accident. If he realizes that he has to reckon with a significant increase in the contribution costs, a change makes sense. In this regard, Stiftung Warentest has also reviewed 163 tariffs of 64 motor vehicle insurances . The result: most insurers use the downgrading of the SF class and significantly reduce the long-term discount of their customers .

Tip: If you do not want to be tormented by the contract documents, you can use the demotion calculator from Stiftung Warentest. It shows, from which amount it pays to pay the damage out of own pocket.

A customer who has been driving for 15 years without an accident can, depending on the tariff, be graded by the insurance company by up to nine classes, according to Stiftung Warentest. He’ll need nine years to get back to his original no claims bonus. Until the cheapest SF class 35 is reached, the overspending caused by the downgrade adds up noticeably. Because compared to the contribution before the accident, these can now be four to five times as high .

Downgrade in car insurance can be avoided in three ways

Should an accident happen despite years of trouble-free driving, the driver usually falls into uncertainty and hectic pace. The desire for immediate protection entices that the person concerned immediately informs his insurance company. This is immediate and follows the downgrade in the SF class, which will take effect from the following year. In advance, the insured has three options on how to circumvent the process or reduce costs.

Save additional costs through loss buyback

The first option is the loss buyback. This is still possible if the driver has already requested the claim settlement . This is often the more advantageous option, especially for smaller accidents . The driver comes out of pocket for the damage and thus saves the additional costs that would be incurred if the insurance lowers the no-claims discount. At best, the customer waits and lets the insurance in advance until a final sum is established. Some insurance companies then have six months to repay the damage.

Discount protection ensures hedging of the SF class

The conclusion of a discount protection is the second possibility, which offers itself to the vehicle owner. He ensures the protection of the customer’s non-infringement class. Thus, the SF class is not downgraded in the accident and the contribution remains . In addition to the usual fare, the driver pays for it up to 25 percent of the annual fee. If the driver wants to change the insurance provider, the discount protection does not remain. If there has been an accident in recent years, this is taken into account when calculating the contribution.

For older policies, the discount savior

If you have an older contract , you can benefit from a third option. However, the so-called discount saver pays off only in the highest SF classes. The rule here is that although the driver is graduated, he is protected from lowering the no- claims discount and thus continues to pay his usual contribution. The discount savior can only be used once . Therefore, it is advisable to consider beforehand whether this use is worthwhile or whether the damage can be paid by yourself.