Deepak YohannanMyInsuranceClub.com
Almost all motor insurance policies give you the benefit of a No Claim Bonus. The No Claim Bonus (or NCB in short) is a special discount that you could get, in case you have a claim free history in your previous policy years. It is a great way to reduce the premium on your comprehensive motor policy. So exercise the option and utilise its benefit to the fullest.
Accumulating your NCB
Accumulating NCB happens over a period of time. The discount that you could expect depends on the number of years you are claim free. So the more claim free years, more is your gain from NCB. The range of bonus is from 20% to 50%. An important point to be borne in mind here is the NCB is applicable on that portion of your premium, which is towards the risk of own damage. It is not on the third party portion. Own damage is 80% of your premium and the balance 20% is towards third party protection. Here is what you could expect.
| Discount | |
| Zero claims in the preceding policy year | 20% on Own Damage |
| Zero claims in the 2 preceding policy year | 25% on Own Damage |
| Zero claims in the 3 preceding policy year | 35% on Own Damage |
| Zero claims in the 4 preceding policy year | 45% on Own Damage |
| Zero claims in the 5 preceding policy year | 50% on Own Damage |
The Convenience of TransferabilityNot having a single claim in a policy year sure does deserve a reward, and there is no better way than a No Claim Bonus. But what happens in case of purchase of a new vehicle or, you wish to change your insurer? Even under such situations, your NCB could still be utilised. You wouldn't have to lose out on this benefit, in times of a change. The fact is that the No Claim Bonus is governed by the policy holder’s driving and claim history, and not on the vehicle or other factors.
When you purchase a new vehicle:
>> Transfer is to be between vehicles of the same kind. So typically you wouldn’t be able to do a transfer of NCB of a two wheeler to a new car. >> You would need to submit a fresh proposal form.>> Pay up a nominal fee for the transfer of insurance and recovery of NCB from the date of transfer till policy expiry.>> Ensure ownership is transferred. Also make a photocopy of the new entry in the RC book for insurance purposes.When you renew your policy with another insurer:
>> Ask for the NCB certificate or holding letter, which comes with three year validity. This letter is valid for three years.>> This would serve as a proof of NCB accumulated from the old insurer.
Making the most of your NCBNo Claim Bonus as a benefit is only available under certain conditions.
>> You can’t expect to get a NCB in case of a claim, however small it may be. Thus to make the most out of your NCB, avoid making small claims. So if there is a dent or a minor damage, it is better to get them rectified from your own pocket expenses. >> Your policy must be renewed before 90 days of its expiry. Once you cross 90 days, you can’t expect to get a NCB. Thus renew your policy on time.
The author is the CEO of MyInsuranceClub.com, an online insurance price & features comparison portal.
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