What is No claim bonus (NCB)

 

No claim bonus is the discount on the future premium payments, which the insurance holder receives from the company for a claims-free year. In case of car insurance policy,  you can enjoy getting discount in your next premiums as per the terms and conditions  mentioned in the insurance plan you opted for.

The concept is simple, car insurance generally provides cover against damages to the insured vehicle and third party claims.

No claim benefit in motor insurance is applicable as long as insurance claim is not made.  After the claim is made, the benefit of no-claim benefits is back to null. This explains that the policyholder will have to make higher payments for premiums because he/she won’t be  eligible for policy premium discounts under no claim bonus scheme.

Though, as per the latest offers made by insurance companies in this field, a policyholder  can still enjoy saving 20 per cent of no claim discount even after claiming the insurance  amount. To avail this benefit, the insurance holder needs to take an add-on cover plan to  protect the benefit of no claim bonus.

If you own a four-wheeler vehicle insured, then the amount of bonus being offered on not  claiming coverage begins in the second year from 20% and can go up to 50% till the sixth  year. All the insurance companies have same rates for the bonus amount on not claiming.  The best way to save money during an insurance policy is to estimate the money you will  need to spend in repairing and compare it with estimated discount you will get through no-  claim benefits in upcoming years. If the amount of discount is higher, you should prefer to  get the damage repaired by yourself instead of claiming for insurance premium and enjoy
getting excellent benefits of no-claim discounts in your policy.