Key Features of NCB in Car Insurance Policy
NCB refers to ‘No Claim Bonus.’ No Claim Bonus is represented in per cent (%). NCB in Car Insurance Policy is a discount offered by the insurance company upon renewal for not claiming the insurance. If you drive carefully, then at the time when you renew your policy, the insurance company provides the “No Claim Bonus” discount as a bonus on your premium for being a safe driver.
Let us assume that if a person purchases a new car for the first time, then the person does not get any discount. However, the insurance firm discounted 20% on your first-time renewal after the completion of the first year. But, it is given on a condition that the person must not have any claim.
This discount rises to 5% during the second year, another 10% during the third year, another 10% during the fourth year, and finally, it reaches up to 50% during the fifth year.
Therefore, if you have not had any claim for five successive years, you can acquire a maximum of 50% discount. You will receive this discount on the premium given for the own car damage but not for the third party liability section.
You have to renew the policy appropriately, i.e., within 90 days of your current policy expiration, to get this bonus.
Moreover, if you get involved in an accident and make an insurance claim, the NCB per cent reaches 0%, the very next year. Finally, if you obtain a claim, then you will not be granted any discount. After that, you need to start getting from zero again.
Some Facts about NCB in Car Insurance Policy
- The significant fact is that your NCB per cent for one car is transferable to another vehicle. Let us illustrate it through an example, if your car has become ten years old and that you would like to sell your old car and purchase a brand new car, and then, you can apply the NCB% that you may have on your old car insurance policy onto your brand new car.
- Furthermore, NCB per cent is also transferable amid insurance companies. Accordingly, if you have a 35% No Claim Bonus in your existing insurance company, you can acquire a similar per cent of discount from another insurance company.
- It is also applicable if you decide to change your insurance firm. Check the NCB per cent mentioned in your car insurance policy’s document today, and apply your possible efforts towards making it up to 50%.
- While it is alluring to make a claim every time your car suffers minor damages, it is reasonable to carry out a cost-benefit judgment before doing so. This is because NCB in Car Insurance Policy reverts to zero even in the state of a small claim.
- NCB can be shifted from one vehicle to another if the policyholder is the same.
- NCB is interchangeable from one insurer to another at the moment of renewal.
- An NCB Certificate from the current insurer will be needed to transfer the NCB in Car Insurance Policy.
- The proof of NCB is usually valid for two years. Consequently, if a policyholder is off the road for any purpose or doesn’t have his policy for more than two years, he will have to begin from scratch the next time he gets out an insurance cover.
- The insured can preserve the accrued No Claim Bonus by giving an extra premium, even if a claim is granted. With No Claim Bonus Protector, one can continue free-minded from missing the NCB in Car Insurance Policy benefit.
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