How to Claim No Claim Bonus (NCB) on New Car Insurance?

No Claim Bonus (NCB) is a significant cost-saving feature in the world of car insurance. It rewards policyholders for safe and responsible driving by reducing their insurance premiums when they do not raise any claims during consecutive policy years. NCB can accumulate over time, providing substantial discounts of up to 50% on insurance premiums. In this in-depth article, we will explore the intricacies of NCB, how it works, and the process of using NCB from old car insurance to reduce the premium on a new car insurance policy.

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Understanding No Claim Bonus (NCB)

No Claim Bonus, often referred to as NCB, is a powerful financial incentive offered by car insurance companies to encourage safe driving behavior. This discount, which can significantly reduce insurance premiums, is earned when policyholders refrain from making any claims during consecutive policy years. The longer you go without raising a claim, the higher your NCB becomes.

Here’s a breakdown of the key aspects of NCB:

NCB Calculation:

NCB increases with each claim-free year until it reaches a maximum of 50% of the premium amount. This table illustrates the NCB calculation over consecutive claim-free years:

• No claims made during 1 policy period: 20% discount
• No claims raised in 2 consecutive policy periods: 25% discount
• No claims raised in 3 consecutive policy periods: 35% discount
• No claims raised in 4 consecutive policy periods: 45% discount
• No claims raised in 5 consecutive policy periods: 50% discount
• Claim-free from the 6th year onwards: 50% discount

NCB Protect Add-on:

While NCB is a substantial reward for safe driving, there are situations where policyholders may need to file a claim due to unfortunate events. In such cases, the NCB might reset to zero. This is where the NCB Protect add-on comes into play. It prevents the NCB from resetting in the event of a claim, offering a safety net for policyholders. However, insurance companies may cap the number of claims allowed under the NCB Protect add-on, often permitting two claims per policy period.

How to Claim No Claim Bonus (NCB) on New Car Insurance?

When purchasing a new car insurance policy, you can claim your No Claim Bonus (NCB) to avail of significant discounts on your premium. NCB is a reward for safe and responsible driving, where policyholders who have not raised claims during previous policy years are entitled to discounts. Here’s a step-by-step guide on how to claim your NCB on new car insurance:

Obtain NCB Certificate from Old Policy:

Contact your previous car insurance company to obtain a No Claim Bonus certificate. This document validates your NCB eligibility based on your claim-free years with your old car insurance policy.

Gather Necessary Documents:

Prepare the required documents, including your old car insurance policy document, a copy of the NCB certificate from the old policy, and your new car’s vehicle details, including make and model.

Inform the New Insurance Provider:

When purchasing the new car insurance policy, inform your new insurance provider about your eligibility for NCB. This is a crucial step to take during the policy purchase process and before making any payments.

Apply NCB Discount:

The insurance company will use the NCB certificate and your vehicle details to calculate the NCB discount. This discount will be applied to the premium amount, reducing the overall cost of the insurance policy.

Pay the Remaining Premium:

Once the NCB discount is applied, you can pay the remaining premium amount. Ensure that the premium payment is made within the stipulated time to avoid any disruptions in coverage.

By following these steps, you can successfully claim your NCB on new car insurance, which can result in substantial savings on your insurance premiums. Remember that NCB is awarded to the policyholder and can be transferred when purchasing insurance from a different insurer or for a new vehicle, provided you have the NCB certificate from your old policy.

Using NCB from Old Car Insurance on a New Car

When you decide to purchase a new car and require insurance coverage, you can leverage the NCB accumulated from your old car insurance policy to secure a substantial discount on your new car’s insurance premium. Here is a step-by-step guide on how to use NCB from old car insurance to reduce the premium on your new car insurance policy:

Earn NCB on an Old Car:

The journey to accumulating NCB starts with safe and responsible driving. Following traffic rules, avoiding accidents, and not raising claims for minor repairs that you can easily manage out of pocket are key practices to maintain your NCB intact. This lays the foundation for earning NCB on your old car.

Retain the NCB when buying a new car:

As previously mentioned, NCB increases with each consecutive year for up to 5 claim-free years, reaching a maximum discount of 50%. If you have an accumulated discount and plan to buy a new car, you can transfer the NCB from your old car insurance policy to the new one, ensuring you continue to receive a 50% discount on the premium.

Obtain an NCB Certificate:

To retain your NCB when transitioning to a new car insurance policy, you’ll need to acquire an NCB certificate. This document supports your claim for the discount and can be obtained in two scenarios:

If you are buying a new policy from your current insurance company, you can request a copy of the NCB certificate for your reference.

If you are switching to a new insurance company, you need to request your old insurer to issue the NCB transfer letter and NCB certificate to avail a discount on your new car insurance policy from a different insurance provider.

Use the NCB:

The NCB you’ve earned can be used to obtain a substantial discount on your current car insurance policy with the help of the NCB certificate. When purchasing car insurance from a digital insurance provider, you can contact their customer care and provide them with the NCB certificate to receive a discounted quote.

Benefits of NCB in Car Insurance

No Claim Bonus in car insurance offers numerous benefits to policyholders, making it a valuable feature. Here are some of the key advantages:

Reward for Responsible Driving: NCB serves as a reward for safe and responsible driving behavior. It acknowledges policyholders who avoid accidents and maintain their vehicles well throughout the policy year.

Lower Policy Premium: The NCB discounts accumulate over five years, resulting in a significant reduction in the policy premium. This makes car insurance more affordable for responsible drivers.

NCB for Policyholders, Not Vehicles: One significant feature of NCB is that it is granted to the policyholder, not the insured vehicle. This means you can retain the NCB benefit even if you sell your existing car and purchase a new one. As long as you regularly renew your vehicle insurance policy, you can continue to enjoy the NCB benefit.

Transferable Benefit: NCB is transferable. If you buy a new vehicle, you can transfer the NCB benefit to the insurance policy for your new car. It’s also worth noting that you don’t lose the NCB for your vehicle if you switch from one insurer to another.

NCB Protection Cover: For those who want to ensure they don’t lose their NCB benefit after making a claim, the NCB Protection Cover add-on is available. This rider allows policyholders to retain their NCB even if they file one claim during the policy year.

NCB in Third-Party Insurance

While NCB is a valuable benefit, it’s important to understand that it is typically applicable to comprehensive and own damage cover insurance policies, not third-party motor insurance. Third-party insurance is a legal requirement for all motorized vehicles, and it does not offer NCB benefits. The NCB discount is not available with other add-on covers except the NCB Protect Cover.

When to Consider NCB Protect Add-on

The NCB Protect add-on is a valuable tool for ensuring you retain your hard-earned NCB benefits. However, there are a few factors to consider:

Limited Number of Claims: Insurance companies may cap the number of claims allowed under the NCB Protect add-on. Typically, two claims per policy period are allowed, but it’s essential to check the exact details with your insurer.

No Claim Bonus Terminated: Keep in mind that your insurer can terminate your NCB under various circumstances. If you file a claim during a policy term, your NCB will be automatically terminated. However, the NCB Protect Cover can safeguard your NCB in case of a single claim during a policy term.

Renewing Your Motor Insurance Policy with NCB

For policyholders’ benefit, NCB can be transferred from an existing policy to a new one, even when renewing your policy with the same insurer. However, it’s crucial to renew your insurance policy before it expires to retain the NCB benefit.

With many insurance providers, including digital platforms like ACKO, you can still retain the NCB benefit even if your motor insurance policy has expired. If you renew it within 90 days of the previous policy’s expiry, you get to keep the NCB benefits for the expired policy.

Here’s how you can renew your motor insurance policy before and after its expiry with a provider like ACKO:

Steps to Renew a Motor Insurance Policy Before Expiry with ACKO:

1. Visit the ACKO Motor Insurance page and select the car or bike option according to your vehicle type.
2. Enter your vehicle registration number and select the ‘Renew’ option.
3. Fill out your personal details and vehicle details, and add the add-ons you want with the insurance plan, including the NCB Protection Cover add-on.
4. Get an instant vehicle insurance premium quote.
5. If the quote suits you, proceed with the payment online.
6. Once renewed, the car insurance policy will be emailed to your authorized email ID.

Steps to Renew a Motor Insurance Policy After Expiry with ACKO:

1. Visit the ACKO Motor Insurance page and select the car or bike option according to your vehicle type.
2. Enter your vehicle registration number and click on the ‘Renew’ option.
3. Provide all necessary person and vehicle-related details, and choose the NCB Protection Cover and other add-ons that you want.
4. Also, provide information about any claims made in the previous policy tenure and the date of expiry of the policy.
5. After all the details are submitted, your vehicle insurance premium is generated and displayed on the screen.
6. If the premium quote suits you, complete the premium payment online, and your expired policy will be renewed.
7. Once renewed, the car insurance policy will be emailed to your authorized email ID.

Conclusion

No Claim Bonus (NCB) is a valuable benefit in car insurance that rewards responsible driving and offers substantial discounts on insurance premiums. By understanding how NCB works and how to use it from old car insurance to reduce the premium on a new car insurance policy, policyholders can maximize their savings and enjoy the financial benefits of safe driving.

Whether through the accumulation of NCB over consecutive claim-free years, the use of the NCB Protect add-on, or the seamless renewal process with digital insurance providers like ACKO, policyholders have the tools and knowledge to make the most of their NCB benefits while securing their vehicles and their financial well-being.