All of us are aware of the increasing prices and taxes on buying an Insurance policy hence it has become very necessary for the Vehicle Owners to understand how they can save on their Insurance Policy. One of the such provisions that Owners should keep in mind when they go out for renewing their existing policy is the factor of NCB i.e. No Claim Bonus.
No Claim Bonus is also known as No Claim Discount. No Claim Bonus is the discount provided to the Vehicle Owner as a gift from the Insurer for not raising any claim throughout the policy tenure. This discount is given on the premium that gets computed on your upcoming year's policy.
When you don't raise or lodge any claim in the first year of your policy, you are given 20% discount on your 1st renewal and similarly the percentage of NCB discount keeps on increasing each year when the Vehicle owner ensures that the claim is not raised consecutively:
|No. Of Claim free Years
|One claim free year
|Two consecutive claim free years
|Three consecutive claim free years
|Four consecutive claim free years
|Five and Five Plus consecutive claim free years
In case you end up raising a claim in any of the policy period in between then your NCB discount drops back to 0%; the NCB also drops to 0% when policy is not renewed within 90 days after expiry. Hence it is often advised to not raise claims if there is small amount of investment needed in rectifying the damage. You need to think from long term perspective than small and little instant gains.
Some important points to remember about NCB
Best of Luck on your purchase of Car Insurance Policy!
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