Protected no claims is a con. You keep your full no claims in the event of having to make a claim on your policy, but they put up your initial premium prior to allowing you the no claims discount.
Insurance is something I don't bother with, unless it's required for legal purposes (such as household insurance for the mortgage company, car insurance, etc.). My mobile phone insurance is that I keep it in my pocket and never drop it.
I don't see how it's a con? It's a % discount on a policy. So losing that discount after an accident will only make the price higher.
People protect their no claims in the belief that it protects their insurance cost. Not true. It protects the discount off any premium which is charged. Insurance companies are wise to this and sell you a policy for an extra amount which implies that in the event of a claim you won't lose your no claims discount. And they charge you for this privilege. Then if and when you need to make a claim they simply increase to base policy premium, and then apply the full no claims from that increased price. How many people have an accident and then come renewal time say "Hey, I have protected no claims, so why has my premium jumped?" and the answer is that there's more premium because you're a higher risk, and the discount is still the same as you paid extra to have it protected. Still costs more though.
Dumb it down.
Unprotected policy costs £500, with 60% no claims, total cost £200.
Protected policy costs £500, with 60% no claims. Plus £50 protection premium. Total cost £250
Have an accident and...
Unprotected policy costs £600 with 40% no claims, total cost £360.
Protected policy costs £600 with 60% no claims. Plus £50 protection premium. Total cost £290
So every year you don't have an accident you save £50, and it all adds up. If you
DO have an accident then it only takes you 2 years you'd have broken even against having protected no claims discount.
Same as the current trend for 80% no claims discount. It's a higher premium with more discount. Ultimately, it all boils down to the actual amount of money you have to hand over to the insurers, and the marketing techniques they use are irrelevant really.