Claim Bonus: Meaning, Example and How It Works in India

What does Claim Bonus mean?

Claim Bonus, in Indian motor insurance parlance, usually refers to the No Claim Bonus (NCB), a discount on Own Damage premium given to policyholders who have not made any claim in the preceding policy year. The slab runs 20% to 50% over five claim-free years.

For most Indian car owners, knowing Claim Bonus matters at the moment of buying a policy or filing a claim. The term shows up on the policy schedule, on the claim form and on the renewal proposal, often in fine print that first-time buyers do not notice until something goes wrong.

HiZuno publishes this glossary so that customers and small-business owners can decode the language of motor insurance in plain English. As of 2026, every entry reflects current IRDAI and MoRTH rules and the prevailing practice across providers in India.

How Claim Bonus applies in India

Under the Indian Motor Tariff, the NCB slab is fixed at 20%, 25%, 35%, 45% and 50% for one to five or more consecutive claim-free years. The bonus is linked to the policyholder, not the car, and transfers when you sell the car or change provider.

A real-world example

A Mumbai owner with 3 claim-free years earns a 35% NCB. On an OD premium of Rs 10,000, that saves Rs 3,500 a year. After 5 claim-free years, the saving compounds to Rs 5,000 at 50% NCB.

Common misconceptions

Why Claim Bonus matters for the consumer

Claim Bonus is the single biggest controllable discount on your premium. Protecting it across renewals is worth more than chasing the cheapest add-on bundle.

How to handle Claim Bonus in practice

A simple, repeatable approach helps you stay in control whenever Claim Bonus shows up in your policy paperwork or claim conversation.

• Confirm the basics: verify that Claim Bonus is reflected correctly on the policy schedule before you pay premium.
• Cross-check with IRDAI norms: the regulator publishes the framework that governs Claim Bonus, so compare what your provider has filed.
• Read the policy wording: the binding contract spells out limits, exclusions and conditions in detail beyond the marketing summary.
• Document everything: keep digital copies of the policy, RC, driving licence and KYC, since most disputes turn on documentation.
• Ask before you assume: a 60-second call to the provider clarifies whether Claim Bonus applies to your specific situation.

Related glossary terms

Frequently asked questions about Claim Bonus