No Claim Bonus, or NCB, is a reward from the insurer for every year you do not make a claim. It is one of the easiest ways to bring down your car insurance premium over time.
What Is No Claim Bonus?
NCB is a discount on the own-damage part of your premium. If you complete a policy year without making any claim, you earn a discount at the next renewal. It does not apply to the third-party premium.
NCB Slab Chart
The usual slabs followed by insurers are:
- After 1 claim-free year: 20%
- After 2 claim-free years: 25%
- After 3 claim-free years: 35%
- After 4 claim-free years: 45%
- After 5 or more claim-free years: 50%
Simple Example
Suppose your own-damage premium is ₹10,000 and you have earned 50% NCB. You pay only ₹5,000 for the own-damage part. Over many years, this adds up to a big saving.
Important Rules to Remember
- NCB belongs to you, not to the car. It can be transferred to a new car you buy.
- Making a claim usually resets NCB to zero at the next renewal, except small claims where you have an NCB protection add-on.
- Letting the policy lapse for too long can cancel your NCB. Insurers usually allow a short grace period, so check your policy terms.
- Claims under third-party liability alone do not affect NCB.
Should You Claim for Small Damage?
If the repair cost is small, compare it with the NCB you might lose. Paying a minor scratch or dent repair from your pocket may save more in the long run. For big damage, always claim.
What Is NCB Protect?
It is an add-on that allows you to keep your NCB even if you make a claim, usually up to a limited number of claims per year. It costs a small extra amount and can be useful for people who drive in heavy traffic.
Frequently Asked Questions
Can NCB be transferred when I sell my car?
Yes. You can keep NCB and use it on your next car. Ask your insurer for an NCB certificate.
Does NCB apply to third-party-only policies?
No. NCB applies only to own-damage premium.
Does NCB expire?
It can expire if you do not renew within the time allowed by your insurer, so renew on time.
