No Claim Bonus: Definition
If you haven't made a claim on your car insurance policy, you may be eligible for a No Claim Bonus. This is a discount given by insurance companies to policyholders as a reward for safe driving and not making any claims in the previous year.
Eligibility Criteria for No Claim Bonus
To be eligible for No Claim Bonus, you need to meet the following criteria:
You must have held a valid car insurance policy in your name.
You must not have made any claims during the policy period.
You must have renewed your car insurance policy before the expiry date.
The NCB can only be availed by the policyholder and not by any other driver.
Calculating No Claim Bonus
The amount of No Claim Bonus that you can receive depends on the number of consecutive claim-free years. The percentage of NCB increases with each claim-free year, as follows:
1st year: 20% discount on Own Damage premium
2nd year: 25% discount on Own Damage premium
3rd year: 35% discount on Own Damage premium
4th year: 45% discount on Own Damage premium
5th year: 50% discount on Own Damage premium
The NCB percentage can go up to a maximum of 50% for five consecutive claim-free years.
Transfer of No Claim Bonus
If you decide to switch to a new car insurance company, you can transfer your NCB to your new policy. To transfer your No Claim Bonus, you need to provide proof of your NCB to the new insurer and they will adjust it in the premium calculation. The proof of NCB can be obtained from your previous insurer in the form of an NCB certificate.
Benefits of No Claim Bonus
Some benefits of No Claim Bonus:
Discount on Premium: The biggest advantage of having a No Claim Bonus is that it results in a discount on your car insurance premium. The discount can range from 20% to 50% depending on the number of claim-free years.
Higher Sum Insured: No Claim Bonus results in a lower premium and you can use the money saved to increase the sum insured for your car. This can help provide additional protection in case of accidents or thefts.
Additional Benefits: Some insurance companies offer additional benefits to policyholders with No Claim Bonus, such as free roadside assistance or cashless repairs at network garages.
Conclusion
No Claim Bonus is a crucial aspect of car insurance that provides numerous benefits. By being cautious while driving and avoiding accidents, you can enjoy a discount on the car insurance premium, a higher sum insured, and additional benefits.
To make the most of your car insurance policy and avail of the No Claim Bonus, it is important to stay alert and drive safely. If you're looking for a one-stop solution for all your parking needs, download the Park+ app , also refer to our car insurance webpage.
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