How to Check NCB In Bike Insurance?

Posted on: Jun 2, 2023 | | Written by:

How to Check NCB In Bike Insurance?

Published on May 29, 2023. EST READ TIME: 4 minutes

NCB or No Claim Bonus is a form of reward awarded by the concerned insurance company, to encourage safe driving practices. This is a special bonus that is offered as a special discount for the premium payable amount in the case of a comprehensive bike insurance policy.

As per the standard norms, the IDV of the two-wheeler reduces with each passing year, while the premium value increases, considering the economic inflation. Therefore, even a minor discount becomes very precious for any policyholder. This factor emphasises the importance of the NCB in bike insurance.

What is NCB in bike insurance?

NCB or No Claim Bonus in bike insurance is the exclusive bonus offered by the insurance company for every claim-free year. If you drive safely, it is evident that you will hardly face any accidental circumstance that will lead you to raise any claim. Therefore, this bonus gets accumulated till you do not file any claim.

As soon as you file a claim, the accumulated gets NCB automatically gets negated.

However, you must note that this benefit of the No Claim Bonus is exclusively available for comprehensive bike policy. Even If you manage to maintain several claim-free years while maintaining a third-party bike plan, it will not add up to reduce your overall premium payable amount.

Why is the No Claim Bonus in bike insurance so important?

NCB is a special reward for observing safe and secure driving practices. As the premium for your two-wheeler rises every year, so does the quantum of the No Claim Bonus. Its biggest importance lies in the fact, that it allows you enhanced coverage at a much reduced cost.

Moreover, the NCB even acts as an incentive for not allowing policy lapse between any plan renewal.

How does the No Claim Bonus function?

For each claim-free year, your NCB gets automatically accumulated. The optimum NCB that you can accumulate is equivalent to 50% of the payable premium amount of the comprehensive bike plan. However, this has to be accumulated for 5 consecutive claim-free years.

After you have reached the optimum limit, you do not gain any further discount or bonus, and you need to pay 50% of your entire payable amount.

A long-term bike plan NCB works differently than a single-year plan. For example, in a three-year-long plan, the NCB resorts back to zero only after the third claim. However, if you make no claim, you can avail of a discount of up to 45%, which gets reduced after the first and the second claims.

How No Claim Bonus is calculated in bike insurance?

You must read this to know how to check NCB in bike insurance. As per the IRDAI norms, every insurer needs to offer NCB. In the case of the comprehensive plan, the NCB begins at a 20% discount during the first renewal which can rise to an optimum of 50%. It is calculated as follows:

Total number of continuous claim-free years	Percentage of discount applicable on the insurance premium
Zero claims made during the preceding first year of the insurance coverage	20%
Zero claims made during a preceding couple of years of the insurance coverage	25%
Zero claims made during the first 3 years of insurance coverage	35%
No claims were made during the first 4 years	45%
No claims made for five years or above after the insurance plan is purchased

You must remember that the NCB is calculated on the two-wheeler, but remains tied to the concerned policyholder. This is the reason, you can even transfer the NCB when you purchase a new vehicle or switch the insurance provider.

Another important factor you need to note is that NCB is exclusively applicable if the bike insurance is maintained uninterruptedly without any lapse. You must ensure continuous coverage, and consider renewing your plan before the due date. However, you can still utilise the grace period of 90 days that most insurance companies provide, without losing any of your benefits.

When is the No Claim Bonus terminated?

Your No Claim Bonus or NCB gets cancelled or terminated under certain specific circumstances. Such situations include:

1. If you raise any claim during the concerned policy term

2. If the concerned plan is not renewed within 90 days of the specific expiry date

3. No NCB facility is available in the case of a third-party plan. This benefit is exclusively limited to comprehensive bike plans only.

How does the No Claim Bonus impact your premium calculation?

NCB is only offered after the completion of the first claim-free year after purchasing the plan. Since then, for each claim-free year, the NCB percentage of the bike plan continues to rise at a steady pace, till it reaches 50%. This is the optimum NCB limit that any standard insurance provider offers in India. IRDAI determines that the NCB discount rate is offered yearly on the purchased two-wheeler plan.

After 1 year, it is 20% of the premium; after 2 years, it is 25%; after 3 years, it is 35% of the premium value, while after 4 years, it rises to 45%. After 5 consecutive claim-free years, the percentage reaches 50% of the total premium payable.

Conclusion

You can now well understand the importance of NCB in bike insurance. You can refrain from making minor claims to keep the NCB intact. You can spend from your pocket to settle minor damages. You can check out multiple bike plans that offer NCB Protect add-ons. Therefore, if you target to save on your bike insurance premium, you must implement safe driving practices. This is the best way to avail yourself of the benefit of the NCB and enjoy affordable and extensive bike plan coverages.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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