What is NCB in Insurance: No-Claim Bonus in Car Insurance Explained

What is NCB in Insurance: No-Claim Bonus in Car Insurance Explained

No-Claim Bonus in car insurance typically refers to a reward granted to the insured car owners. However, this reward is provided to those who don’t register any claim during the policy tenure. It basically consists of a discount on the premium of your car insurance that can be applied during policy renewal.

This article will give you quick insights into different aspects of the No-Claim Bonus in car insurance. Please keep reading until the article’s end to learn more about it.

Let’s dive in.

How Does No-Claim Bonus in Car Insurance Work?

Most car insurance providers offer a special benefit in the form of NCB by reducing your car insurance premium.

A No-Claim Bonus in your car’s comprehensive insurance works like a rewards system. If you haven’t made any claims during your first policy year, then you gain a 20% NCB discount. And if you continue this policy of making zero claims in consecutive years, then you will keep gaining an additional 5%.

In the sixth consecutive year, the reduction of your car insurance premium will result in 50%. This means the better you drive your car; the better things work out for you in the long run.

What are the Benefits of NCB in Car Insurance?

When it comes to a car insurance policy, a No-Claim Bonus provides a plethora of benefits to vehicle owners. Some of the most compelling ones include:

●      Opportunity to Earn Rewards

Most car insurance providers grant NCB as a reward to those who maintain the good condition of their car by making no claim.

●      Lower Premium Amount

No-Claim Bonus in motor insurance enables a policyholder to earn at least 20% and up to 50% discount on their car insurance premium. With every claim-free year, a 5% of NCB discount is granted to the insured after the first no-claim year.

You can use this huge discount to reduce the premium amount you need to pay while renewing your policy.

●      Easily Transferable

The No-Claim Bonus can be seamlessly transferred to another car if the policyholder changes their car. Besides, it can also be transferred from one insurance company to another. But to transfer your NCB, you must acquire an NCB certificate from your previous insurance company.

●      Granted to Policyholders

The best thing about No-Claim Bonus in a car insurance policy is that it is granted to the policyholder. So whenever you purchase a new car by selling the older one, the NCB will remain with you. But in order to retain the same, you need to renew your car insurance policies timely. However, the No-Claim Bonus cannot be transferred to the car’s new owner.

●      Better Savings

The NCB percentage on your vehicle insurance will automatically increase if you don’t raise any claims for five consecutive years. In return, you will get a sizable discount of up to 50% on your premium insurance policy renewal.

How Can You Get an NCB Certificate?

When you purchase a vehicle insurance policy, you will be provided with an NCB certificate.

Now, to acquire the NCB benefits, it will completely depend on you. If you make any claims from your motor insurance policy provider, you won’t be entitled to the NCB benefits for the following year. But if you drive responsibly and don’t make any claims, you will be eligible for the NCB benefit.

To Conclude

No-Claim Bonus of comprehensive insurance like car insurance is cumulative in nature. It allows you to save at least 20% to 50% on your insurance premiums. However, it depends on the number of years you go without making any insurance claim.

Driving carefully on the road has remarkable benefits for you and your insurer. But only some things on the road can be controlled, and sometimes making a claim is inevitable. Thus, it is ideal for you to get the No-Claim Bonus protection add-on and drive peacefully on the road.


  • How can I check the applicable No-Claim Bonus for car insurance?

To check the applicable no-claim bonus for car insurance, you need to refer to the NCB slabs. During the online insurance renewal process, you will find the applicable NCB mentioned on the webpage. Please note that your policy document will also mention the NCB calculation post-policy purchase.

  • Is a No-Claim Bonus applicable for third-party insurance?

No-claim bonus is not applicable for liability-only third-party policies in motor insurance.

  • Can I protect the accumulated no-claim bonus?

You can always protect the accumulated no-claim bonus. However, you can also opt for the NCB protection Add-on while renewing your vehicle insurance policy.

  • What is the maximum no-claim bonus for car insurance in India?

The maximum no-claim bonus for a car insurance policy in India is typically 50%. But this scenario remains applicable only when no claims have been raised for a consecutive period of 5 years.

  • How can I acquire the NCB transfer certificate?

If you wish to avail yourself of the NCB transfer certificate, you will have to reach out to your insurance company and request the NCB transfer certificate. Remember that different insurance companies might follow different procedures.

  • Will my NCB become invalid if I stop driving?

Your No-Claim Bonus will remain intact even if you’ve stopped driving your car. You might lose your NCB benefit only when you raise a claim or don’t renew your car insurance policy.