When you buy a new motor vehicle, you will always like to protect your new possession with an insurance policy. But shelling out a high motor insurance premium has raised concern for the policyholder to look out for a possible solution. The add-on benefits in the form of NCB can bolster your problem only if you have a better insight into what is NCB in insurance.  

No Claim Bonus or NCB is designed as a defensive measure that is taken to raise the awareness of safe driving. It is provided as a complimentary benefit to the policyholder if the person does not make a claim during the policy tenure. In this way, NCB not only helps you to in getting a discount on your insurance premium but also raises your awareness to drive safely. Moreover, to have a definitive idea of what is NCB in insurance and how it works, go through the guide that is given below. 

A Guide to NCB in Motorvehicle Insurance  

The No Claim Bonus is an add-on benefit that is provided to the policyholder for a specific time period of the policy. The policyholder can avail of the benefits only during the renewal if no insurance was claimed during that specified period. However, if a policyholder damages his car in a road accident, then the person won’t be entitled to the same benefit. The benefit of NCB will be revived on the next renewal of NCB. 

Calculative Rate of NCB 

No Claim Bonus or NCB helps in the annual reduction in the premium of the car of the policyholder. The policyholder is entitled to get an additional 5% discount for each claim-free year, which can be used subsequently to reduce the premium on the renewal of the policy. So, here is a calculative rate chart of NCB that is given below:

How to Retain the Benefits of NCB in Insurance 

In order to avail the benefit of NCB in motor vehicle insurance, one must retain it for the given time period. It may not be possible to be precautious in every step, but driving with a sense of awareness will not only help you in maintaining your own safety but will also help you to retain the benefits of NCB. So, in order to retain the benefits of NCB, one must be aware of the two important aspects that are discussed below: 

• When to Make a Claim – First and foremost, the policyholder must remember that once you claim for the compensation, you lose the benefit of NCB for that particular policy tenure. So, to retain your NCB insurance, it is better that you hold on to your insurance claim or choose an NCB protection. 

In the case of small or minute damage, try to avoid utilizing the No Claim Bonus policy. This will help the NCB percentage to double with passing on of each year. However, if there is any major issue or damage to your car, then making a claim will be the best option. Though in the process, you will be going to lose the benefit of getting a discount on your insurance premium during the renewal. 

• Transfer of NCB – If you are planning to get rid of your old car with a new one, then the policyholder needs to request for the transfer of the NCB. Provide your insurance company all the required documents like NCB certificate and sales proof of the car. The transfer process will help the policyholder to retain NCB car insurance.   

How to Protect the NCB in Insurance? 

Retaining a no claim bonus is always a good idea. Still, in the building up of NCB over the years, it is also essential for an individual to safeguard it against any possible losses. Therefore, to safeguard the NCB insurance premium, the policyholder needs to pay a small fee. This will provide the policyholder with extra coverage by allowing a set number of faulty claims before the NCB is affected. 

However, before opting for the protection of the NCB, the policyholder should check the terms and conditions of the insurance provider. As in some cases, the insurance provider allows two claims before the main bonus is affected while, in other cases, the percentage of NCB is reduced on the second claim.    

Wider the Scope of Protection with NCB 

Among some of the attractive benefits of car insurance, NCB is a productive feature as it offers financial protection during the mishap. However, it will be diligent if you can retain the NCB for the policy period and efficiently utilize the same in the long run.