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No Claim Bonus (NCB) in Car Insurance
How Does NCB in Car Insurance Work?
Benefits of NCB in Car Insurance
| Benefit | Description |
| Reward For Maintaining Your Car | NCB is an incentive from insurer that encourages you to be a responsible driver. If you face zero accident, you can get discount during car insurance renewal. |
| Tied to the Owner, Not the Vehicle | A no claim bonus is earned by the vehicle owner. This means that even if the policyholder sells his/her car, the no claims bonus stays with them and becomes applicable to the next car they purchase. |
| Great Savings on Premiums | A no claim bonus allows you to save between 20 to 50% on your car insurance premium depending on the number of years you go without making an insurance claim. |
| Transferable at Your Convenience | NCB is easily transferable in case you shift from one insurer to another. You simply need to obtain your NCB certificate from the previous insurer and submit it to the one you’re switching to. |
How is NCB in Car Insurance Calculated?
NCB is calculated on the amount of your car insurance premium starting from the second year. It usually begins with a 20% discount on the premium and subsequently goes up with each consecutive claim-free year. It needs to be noted however that the NCB is calculated only on the own damage component of the premium and not on the third-party component. You can reach out to our team at HDFC ERGO to know more details about this.
| Claim-free Year | NCB Discount |
| After 1st claim free year | 20% |
| After 2 consecutive claim free years | 25% |
| After 3 consecutive claim free years | 35% |
| After 4 consecutive claim free years | 45% |
| After 5 consecutive claim free years | 50% |
As can be seen from the table above, an NCB leads to great savings over time for car owners.
So for example, if Mr. Sharma pays an insurance premium of Rs. 20,000 for his car, of which Rs. 18,000 is the own damage component, and he has not made any insurance claim for 5 consecutive years, he becomes eligible for a discount of up to 50% or Rs. 9,000.
Also Read : Know about NCB Calculation during car insurance renewal
When Is The No Claim Bonus Terminated?
No Claim Bonus (NCB) can get terminated under various circumstances. As a policyholder, there are numerous things which you have to keep in mind to keep your NCB benefits active.
If the insured person claims the policy term, the No Claim Bonus privilege will be withdrawn or terminated by the insurer. For example, for raising a claim to cover damages caused to the car due to an insured peril, there will be no claim bonus termination. However, if the policyholder has the No Claim Bonus Protection Cover, their NCB benefits will remain active. In addition, if the policyholder fails to renew their car insurance within 90 days or three months from the date of expiry of the car insurance policy, then here, too, the NCB will be terminated by the insurer.
Suppose the policyholder allows the policy to lapse, irrespective of the accumulation of claim-free years and eligibility for premium discounts of the car insurance policy. In that case, the car insurer will withdraw the No Claim Bonus. Lastly, if the policyholder fails to transfer the No Claim Bonus to another insurer or a new car insurance policy within a certain period, then the No Claim Bonus will be withdrawn by the car insurer.
Can No Claim Bonus be Protected?
The policyholder can safeguard the accumulated NCB in car insurance, even in the event of a claim, by paying an additional premium for the NCB Protector add-on. With a No Claim Bonus Protector, you can avoid losing your NCB benefit.
Due to the fact that choosing NCB coverage provides inexpensive premiums for longer than a year based on the number of NCBs acquired, this is one of the rider options that customers prefer the most among all those that are offered. Therefore, you are qualified for inexpensive premiums starting in the second year. In this way, the policyholder can save up to 50% on insurance premiums.
NCB if the Vehicle is in an Accident or Stolen
Only when you understand the NCB in car insurance meaning, would you be able to understand its applicability?
NCB in Case of Accidents
NCB in Case of Stolen Car
Still wondering if you need car insurance?
How to Transfer NCB When You Buy A New Car
An NCB is easily transferable from your old car to a new car. This is because the NCB is tied to the owner and not the vehicle. All you need to do is follow these simple steps:
Submit an NCB Transfer Request
Obtain Your NCB Certificate
Apply for New Insurance Policy
Terms and Conditions of No Claim Bonus Transfer
In order to claim ncb in insurance, you have to keep in mind following terms and conditions
1. When buying a new car and selling an old vehicle, ensure you transfer no claim bonus to the new vehicle. At the time of the transfer process, the insurer will issue a certificate. However, this decision could be at the discretion of the insurance company.
2. You cannot buy no claim bonus with third party insurance cover. It is only available with your own damage cover or comprehensive policy.
How To Check NCB In Car Insurance
You can check the applicable NCB by referring to the no claim bonus slabs. The NCB will be mentioned on the webpage during the online car insurance renewal process. If you renew your car insurance policy with a different insurer, you must mention the NCB earned in your previous policy. You can also view the NCB calculation in your policy document post-policy purchase.
To understand the working of a no claim bonus calculator, refer to the following table:
| Age of policy | No Claim Bonus Percentage |
| After year one of no claim | 20% |
| After two consecutive years of no claim | 25% |
| After three consecutive years of no claim | 35% |
| After four consecutive years of no claim | 45% |
| After five consecutive years of no claim | 50% |
Documents Required for Smooth Transfer
Your car insurance policy copy and must be valid.-of-your-vehicle.svg?sfvrsn=6fd8e841_2 "Step 2- A copy of the registration certificate (RC) of your vehicle.")
A copy of the registration certificate (RC) of your vehicle.
A valid photo ID.
How To Ensure You Do Not Lose NCB During Motor Insurance Policy Renewal?
The policyholder can transfer the no claim bonus from an existing policy to a new one, irrespective of whether you are renewing the policy with the same insurer or the other. However, renewing your insurance policy before it expires is important to retain the no claim bonus benefit. To avail no claim bonus benefit, ensure that you renew your car insurance within 90 days of the previous policy’s expiry.
Steps to Renew a Motor Insurance Policy Before Expiry
• Visit our website and click on the car insurance.
• Enter your vehicle registration number and select the ‘Renew’ option.
• Fill out your vehicle details. Also, add-ons like zero depreciation and ncb protection cover along with the car insurance plan.
• Get an instant car insurance premium quote.
• Proceed with the payment online.
• Once renewed, we will email the car insurance policy to your authorised email ID.
Important Things to Know about NCB in Car Insurance
Many questions arise in the insurer's mind in relation to NCB in car insurance. Let us see some important queries you need to know about NCB insurance.
When is NCB Terminated?
You will continue to avail benefits from NCB in car insurance as long as you do not claim. It is essential to know that if you do not renew your existing insurance policy within 90 days from the expiry, your NCB will be terminated, and you will no longer benefit from the no claim bonus. Hence, it is wise to renew your policy on timely basis.
How to get NCB Certificate?
When buying a car insurance policy, the policyholder is provided with an NCB certificate. It now depends on whether the insurer makes any claims in the policy year. If insurers claim, they will not be entitled to the NCB benefit for the next year, but if they don't claim for the entire year, they will be eligible for the NCB benefit.
HDFC ERGO Car Insurance Add-ons
When it comes to car insurance, spending a small amount more for car insurance add-on coverage can prove to be the best choice because it completely protects your family and your precious car. HDFC ERGO provides you with comprehensive insurance policies with appealing features and budget-friendly pricing. In all emergency situations, we cooperate with you to maintain the safety of your family and your car. In all emergency situations, we cooperate with you to maintain the safety of your family and your car.
As per this add-on, HDFC ERGO is responsible for paying the complete claim without making any adjustments for the depreciation that would be applied to the damaged parts of a partial loss claim.
If there is an accident that damages the car, one of the biggest concerns when choosing insurance is that you won't be qualified for a no-claim bonus. However, this cover ensures that you can take advantage of the NCB benefit for being a careful driver.
In the event of a car breakdown, the insurance provider will offer a variety of services around-the-clock, including fueling, towing, scheduling a mechanic, changing a flat tyre, and more.
Under this add-on, we offer you 25% of the basic own damage premium if you drive less than 10,000 kms in a year. It is available at the end of a policy year.
With this add-on cover the insurer will cover expenses for replacing the tyres and tubes of the insured vehicle. This coverage is applicable when the insured vehicle tyres burst, puncture, or face a cut during an accident.
By investing in a return to invoice cover, you can make sure that, rather than receiving the insured declared value in the event of car loss or theft, you instead receive the original invoice value, which includes the registration fee and taxes. This add-on policy covers the gap between the approved claim amount and the car's initial purchase price.
Insurance usually does not cover Internal damage to the engine and gearbox; however, this add-on feature guarantees coverage for accidental damage to the engine and gearbox as a consequence of waterlogging or lubricating oil leakage. When driving through flooded areas where harm may occur accidentally, you can be tension free.
This add on cover will help bear the expenses you spend on cabs for your daily commute while your car is getting repaired.
Loss of Personal Belonging add on covers loss of your personal belonging such as cloths, laptop, mobile, vehicle documents like Registration Certificate, Driving License etc.
With this add on cover under the car insurance policy the policyholder get coverage for consumables items like lubricants, engine oil, brake oil, etc.
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Read the Latest Blogs on No Claim Bonus in Car Insurance
How to Use NCB Effectively to Save on Car Insurance Premium
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Frequently Asked Questions On No Claim Bonus In Car Insurance
● You make an insurance claim within a policy period.
● You fail to renew your policy within 90 days of expiry.
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