When you buy car insurance, it often feels like a grudge purchase. You’re essentially paying for “what ifs” — money leaving your bank account every month for something you hope never happens. And if you’re anything like me, you’ve probably stared at your insurance premium and wondered, “Why does this never seem to go down?”
Momentum’s no-claims bonus is one of those things that attempts to soften that feeling. On paper, it sounds great: the longer you go without claiming, the lower your premium could become. It feels almost like a reward for being cautious, disciplined, or just plain lucky. But as with most things in insurance, there’s more to it than meets the eye.
Let’s walk through how it works, why it appeals to so many drivers, and whether it really saves you money in the long run.
The Basic Idea Behind a No-Claims Bonus
At its core, the concept is simple: if you don’t make a claim on your insurance for a set period, your insurer rewards you. Usually, that means discounted premiums or some form of cashback. Momentum, like several other South African insurers, frames it as a way to “reward safe driving” and to encourage customers to think twice before claiming for small incidents.
In practice, it works a bit like a loyalty program. The longer you stay claim-free, the more you stand to benefit. It’s almost like building up “good behavior points.” That’s the marketing spin, anyway.
But let’s be honest: insurers aren’t running charities. The structure is also designed to reduce how many small, frequent claims they need to pay out. By dangling a reward in front of you, they’re quietly nudging you to shoulder the cost of minor damages yourself.
Why the Idea Appeals to Drivers
On the surface, the no-claims bonus is very attractive. Who doesn’t want to see their premiums shrink rather than rise year after year? In South Africa, where the cost of living keeps inching upward and petrol prices spike without warning, anything that cuts a monthly debit order feels like a victory.
I’ll admit, the first time I heard about it, I was sold immediately. My car had gone five years without a scratch — not even a parking lot ding. I figured, “Why should I pay the same as someone who crashes every six months?”
Momentum’s offering plays into that exact frustration. It positions itself as fairer, almost like the insurer is on your side. And maybe it is, to a degree. There’s a psychological relief in knowing that your cautious driving habits might finally count for something tangible.
How It Actually Works
Momentum’s no-claims bonus typically kicks in after a year of being claim-free. Your premium may be reduced or you could qualify for a discount structure that increases the longer you maintain the streak. The details depend on the policy, but the idea is progressive: year one may give you a small benefit, year three a bigger one, and so on.
But here’s where it gets tricky. Not every claim resets the clock. Some insurers distinguish between types of claims — for instance, if someone rear-ends you and it’s clearly not your fault, you may still retain your bonus. In other cases, any claim at all can throw you back to square one. It’s worth checking the fine print, because assumptions can lead to nasty surprises.
I’ve heard of drivers who avoided claiming after hail damage or a cracked windscreen because they didn’t want to jeopardize their bonus. On one hand, that shows the incentive works. On the other hand, it also means people are paying out-of-pocket for things their policy technically covers.
The Real Savings: Significant or Symbolic?
The million-rand question is whether the no-claims bonus actually saves you a meaningful amount of money. And the answer seems to be: it depends.
For some, the discount can add up over years. Imagine shaving R200 or R300 off your monthly premium by the fourth or fifth year. That’s not small change; it’s groceries or petrol for the week. But if you end up having to make a claim early in the process, you may never see that benefit.
Critics also argue that the bonus structure may overstate how much you’re “saving.” Insurance companies calculate risk into their premiums from the start. So while you may feel rewarded, in reality, you’re simply being charged closer to what you arguably should have been paying all along.
That said, perception counts for a lot. A discount feels like a win, even if technically it just brings you to the fairer side of pricing.
A Small Anecdote: Why I Didn’t Claim
A couple of years ago, I had one of those awkward bumps in a shopping mall parking lot. Nothing dramatic — a slow reverse into a badly parked trolley bay. My rear bumper was scuffed, repairable for about R3,000. My excess? R3,500.
It didn’t take long to do the math. Claiming would cost me more out-of-pocket than fixing it myself, and claiming would risk resetting my bonus streak. So I paid the panel beater myself. At the time, it felt like an annoying but rational decision.
Looking back, though, I realized something: the system had trained me to act in the insurer’s best interest. Instead of using the cover I was paying for, I absorbed the cost. Sure, my premiums didn’t go up, but Momentum also didn’t pay a cent toward the damage. That’s not necessarily unfair, but it does highlight who benefits most from these arrangements.
The Psychological Side
One of the cleverest aspects of the no-claims bonus is the way it plays on psychology. It creates a sense of “gamification” in something otherwise boring. Suddenly, you’re not just insured; you’re competing with yourself to keep the streak alive.
Every month you go claim-free feels like progress. The risk of losing your “points” makes you hesitate before picking up the phone to report damage. It’s the same logic behind loyalty programs, step counters, or even video game achievements. And for insurers, that hesitation is gold.
Is It Always Worth It?
The tricky part is that the bonus may not suit everyone. If you live in a busy urban area where bumper-bashings are almost inevitable, you might never build up the streak long enough to benefit. If you drive an older car where small damage isn’t worth repairing, the bonus is more appealing. But if you’ve financed a brand-new SUV and want every dent fixed, then withholding claims just to protect a discount may not be in your best interest.
Another consideration is inflation. Insurers may still increase base premiums each year to account for rising repair costs, even if you’re not claiming. So while the no-claims bonus lowers your premium, the increase from inflation may offset much of the discount. In that sense, the bonus helps you tread water rather than surge ahead.
Alternatives and Comparisons
Momentum isn’t the only insurer dangling carrots. OUTsurance has its OUTbonus cashback, Discovery has Vitality Drive with fuel rewards, and King Price famously decreases your premiums monthly as your car depreciates. Each of these speaks to the same driver frustration: “I don’t want to feel like I’m paying for nothing.”
Momentum’s no-claims bonus is arguably one of the simpler models, but that simplicity can also make it less dramatic than cashback payouts or flashy discounts at fuel stations. Some drivers might prefer a tangible lump sum every few years rather than a slow trickle of monthly discounts.
A Balanced Perspective
I don’t think the no-claims bonus is a bad deal. In fact, for disciplined or low-mileage drivers, it can work beautifully. But it’s important to view it with both eyes open. The insurer isn’t just rewarding you; they’re incentivizing you to behave in a way that minimizes their own costs. That’s not sinister — it’s just business.
Where drivers sometimes stumble is in assuming the bonus makes them “special” or “uniquely rewarded.” In reality, it’s a calculated trade-off. You’re giving up the security of claiming for small things in exchange for a lower monthly cost. Whether that’s worth it comes down to your driving habits, financial cushion, and tolerance for risk.
Final Thoughts
Momentum’s no-claims bonus taps into something we all crave: recognition for being careful. It turns your caution into tangible savings and reframes the dreaded debit order as slightly less painful. But it’s not a free gift. It’s a structured deal where the insurer almost always comes out ahead.
The trick, I’ve learned, is to treat the bonus as exactly that — a bonus, not the backbone of your insurance strategy. Take it if it works for your lifestyle, but don’t be afraid to claim if you need to. Insurance exists for peace of mind, not just for the game of chasing discounts.
At the end of the day, saving money on premiums feels good. But having the confidence to pick up the phone when things go wrong — without second-guessing whether you’re sacrificing your streak — may be worth just as much.