No claim bonus is probably one of the best features of a car insurance policy. There are very few other products or services out there that reward you in a similar manner for being precautious. However, in spite of being such a helpful attribute, not all car owners are fully informed about the minor details of how this super-advantageous component of motor insurance works. Keeping that in mind, the following article will highlight 5 things all insurance owners should know about their no claim bonus.
- NCB keeps increasing.Yes, that’s right! The longer you go on without making a claim against your car insurance policy, the higher the level of discount you are provided on your premium amount. For one claimless preceding year, you get a 20% discount on the premium amount. Go without a claim the next year too and it’s bumped up to 25%. Keep a clean sheet again and you jump to a 35% discount. Another safe year of driving and you’re looking at a 45% discount. Finally, for 5 years and more of claimless driving, you get a 50% discount – which is the maximum discount amount.
- NCB can be transferred.Another very thoughtful feature of NCB is that it can be transferred. This means you can change insurance provider or car without losing your NCB discount. Because, no matter who insures you or which car you drive, it doesn’t change the fact that you’ve been a safe driver for years. Keeping this in mind, all insurance companies will recognize the NCBs earned with another insurance company, or with another car, even if you switch over to them.
It can be terminated too!
It can take very little time to lose the NCB discount you’ve earned over years. Someone else’s mistake might cause an accident forcing you to make a claim – this, in turn, will cause your NCB to be terminated. Besides making a claim, if you forget or fail to renew your policy for 90 days after it expires, it could again lead to the cancellation of your NCBs.
4. NCB can be protected.
Say you’ve been driving safely for years now and currently enjoy a 50% discount on your premium amount; wouldn’t it be unfair to lose your NCB by making just one single claim? However, there is a way to ensure you do not lose your NCB, even if you make a claim against your car insurance policy. It might seem unlikely but it’s actually really simple – all you have to do is opt for the NCB protector add-on. Your premium amount might go up a little but it still beats the prospect of paying the full premium, as you would have to if you were forced to make a claim.
- Be safe, but be smart too!Accumulating your NCB is just as much about being safe as it is about being smart. On Indian roads, you can get into minor fender benders even after being as safe as possible. In such a scenario, you need to be smart and weigh the savings of your NCB against the cost of repairs. If the latter is lower than your NCB savings, just cover it out of your own pocket and hang on to your NCBs, unless you have a NCB protector. Another smart thing you could do is to opt for long-term car insurance; these plans are much more cost effective and also allow you to make a claim or two during the tenure of the policy without fully canceling out your NCB.
These were 5 things to know about the NCB on your car insurance. Hope this article will help you in the future.
Good luck, all the best and drive safe!
