All you need to know about No Claim bonus
What is the No claim bonus?
If you have saved yourself from making motor insurance claims, then No-Claim Bonus (NCB) is something you would be definitely interested in. No claim bonus is a discount offered on the car insurance premium. An insurer is entitled to avail this bonus upon policy renewal only when he has made no insurance claims in the preceding year.
How much bonus can I avail?
The discount percentage that can be earned depends upon the consecutive number of years for which no claim has been made. NCB can be availed as a cumulative bonus and the discount falls approximately between 20% to 50% on own damage premium.
Interesting facts about No Claim Bonus
- NCB can be availed upon policy renewal
No Claim Bonus, the name itself implies that it is a bonus that can be availed for not making any claim. The insurer offers this discount to the policyholder on the premium payable, upon renewal of the policy. However, when you buy your first insurance policy, you are normally not eligible for any such discount on the premium because you have no past claim-free record.
- NCB can be switched from one car to another
This is a distinctive feature of NCB. No Claim Bonus is linked to the policyholder and not to the vehicle. Therefore, you can benefit from your existing NCB when you replace your old car with a new one or in case you switch to another insurer upon renewal of the policy.
- No NCB for third party liability
The NCB discount is tied to the own damage premium component of the insurance policy and has nothing to do with the third-party liability premium.
- Refrain from making small claims
We tend to make a claim even in case of small damage. But, these small claims are not profitable as when you make a claim, as the NCB moves to zero. Therefore, it is advisable to evaluate the benefit in both cases and then decide on making a claim.
- NCB can be protected
Confused about how to choose between claim and NCB? Not to worry, you can protect your NCB by opting for the NCB protect add-on cover. When you opt for this cover, your NCB stays protected even in case of a claim under certain restrictions.
**To understand exactly about the policy coverage, exclusions etc read the Policy Wordings carefully.**