How to avail no claim bonus on your new car insurance premium
Car accidents are both unexpected and stressful. Without car insurance, you’ll face hefty financial responsibilities, from legal fees and repair costs to medical expenses. On top of this, owning at least a third-party car insurance policy is mandatory in India under the Motor Vehicle Act of 1988.
But car insurance isn’t just a legal requirement; it’s a powerful safety net. If you opt for comprehensive car insurance, the benefits go beyond covering accidents. It offers protection against natural disasters like storms and earthquakes, as well as man-made incidents like theft and riots.
If you’re a safe and responsible driver who avoids claims throughout the year, insurers offer an attractive reward called the no claim bonus (NCB). Wondering how NCB works and how you can use it to reduce premiums on your new car insurance policy? Keep reading for all the details.
- What is no claim bonus (NCB)
- Why NCB matters and key features
- Benefits of using NCB on new car insurance premiums
- Steps towards smarter driving and claims
- Steps to claim and transfer NCB for your new car
What is no claim bonus (NCB)
The no claim bonus (NCB) is a benefit for staying claim-free during your policy period. This reward comes in the form of a discount on your car insurance policy premiums and can significantly lower the cost over time.
Here’s how the NCB accumulates for consecutive claim-free years:
Claim-free years | NCB discount on premium |
|---|---|
| 1 year | 20% |
| 2 years | 25% |
| 3 years | 35% |
| 4 years | 45% |
| 5 years | 50% |
The highest NCB discount you can get is 50%. Even if you remain claim-free for additional years, the discount will not exceed this limit.
Why NCB matters and key features
Before we jump into claiming your NCB on a new car insurance policy, here are some essential points to remember about this reward system and why it’s so valuable:
1. Tied to policyholders, not cars
One of the key benefits of the no claim bonus is that it’s awarded to the policyholder, not the car itself. You can transfer your NCB from your old insurance to a new car insurance policy, ensuring you keep your well-deserved discount.
2. Carry it across insurers
Planning to switch insurers or buy car insurance from a different provider? Your NCB comes with you! Insurance companies recognize NCB across policies, as the reward is tied to your driving record, not the company.
3. Applicable only for comprehensive insurance
Keep in mind that NCB is only available for those with comprehensive car insurance policies. It’s not applicable for standalone third-party liability policies.
4. Maintain it by avoiding claims
For minor repairs or damages, it’s often better to cover the cost out of pocket rather than making a claim. Filing claims for small issues could nullify your NCB, so it’s worth considering whether the cost outweighs the benefit of keeping your bonus intact.
5. Use NCB add-on covers for extra protection
Some insurers offer an NCB protect add-on. This allows you to retain your no claim bonus even after making a minor claim during the policy term.
By transferring your NCB when purchasing new car insurance, you’re not only rewarded for safe driving but also keeping your premiums low. These discounts, compounded over the years, make comprehensive policies more affordable while offering maximum protection.
Saving tip
If you've consistently been a careful driver, use your 50% NCB discount strategically. Renew your policy on time every year and avoid claims for minor damages, allowing you to benefit from the maximum reward in the long run!
Steps towards smarter driving and claims
Driving safely benefits everyone on the road and it helps your wallet! To ensure you make the most of your no claim bonus, follow these final tips:
- Avoid filing claims for small repairs if you can afford them.
- Keep track of renewal dates to prevent losing your NCB.
- Opt for an NCB protect add-on cover if you’re eligible.
Remember, NCB is designed to reward responsible driving. Use it to maximize your savings and maintain lower premiums on both your old car insurance policies and future new car insurance agreements.
Steps to claim and transfer NCB for your new car
When purchasing new car insurance, the first step is to ensure your NCB is factored into the premium. Here’s a simple way to use it effectively:
1. Retain and transfer your old NCB
If you’ve been a careful driver and accumulated NCB on your old vehicle's car insurance policy, you can transfer it when purchasing insurance for your new car.
- Request an NCB certificate from your previous insurer.
- Provide this certificate to your new insurer as proof of eligibility.
- This will allow you to apply the accumulated discount on your new car insurance premium.
2. Get an NCB certificate
To claim NCB on your new policy, an NCB certificate is essential. Here’s what you need to do:
- Insuring with the same company
If you’re sticking with your previous insurer, simply request a copy of your NCB certificate.
- Switching insurers
If you’re using a new insurance provider, contact your previous insurer for an NCB transfer letter and certificate.
3. Double-check your NCB details
Accuracy is key when transferring your NCB. Incorrect NCB claims whether intentional or by mistake can result in policy rejection or cancellation. Always provide accurate information about past claims and NCB status to your new insurer.
4. Leverage your NCB discount
Get discounts from 20% to 50%, based on your claim-free years. This can make a significant difference in reducing the cost of your comprehensive car insurance policy.
5. Secure continuous coverage
Renew your policy within 90 days of its expiry to keep your NCB benefit.. A lapse beyond this period can void your accumulated bonus.
Achieve maximum savings on your insurance
Navigating insurance policies can feel confusing, but understanding the no claim bonus makes things straightforward. By transferring your NCB with every policy renewal or vehicle purchase, you get to keep the rewards you’ve earned while enjoying the benefits of comprehensive car insurance.
Ready to claim your no claim bonus on your new car insurance policy? Start by securing your NCB certificate today and say hello to lower premiums!
ARN: Zuno/Blog/DM/How to avail no claim bonus on your new car insurance premium/12/24/17
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Disclaimer
Zuno General Insurance Limited does not assume any liability for actions taken based on the information contained in this blog. All insurance products and services are subject to the terms and conditions of the specific policy. Coverage and pricing may vary based on individual circumstances and eligibility.
