No-Claim Bonus-Benefits and Understanding
While prices generally tend to rise, car insurance offers a unique proposition whereby premiums can go down every year. In motor insurance, No Claim Bonus (NCB) is a reward given by an insurer to a policyholder for making no claims during the policy term. No Claim Bonus can be accumulated as a discount on the premium over the years. The discount ranges from 20%-50% on their damage premium and can be claimed even if the policyholder changes its vehicle. The discount can be used at the time of policy renewal.
Benefits of No-Claim Bonus
- Lower Premiums- The No-Claim bonus helps a policyholder to earn a 20% discount on his car’s insurance premium. This discount may increases steadily with every claim-free year up to a maximum of 50% at the end of five claim-free years. Every claim-free year, the no claim bonus discount is offered to the policyholder, which can be used to reduce the premium amount. The insurance company rewards the policyholder for practicing safe driving and not making any claim under the expiring policy.
- Reward- No-claim Bonus works as a symbol of responsibility and attentiveness. This is awarded to the drivers who drive responsibly and maintain the health of their car. It is a discount reward on your premium when you do not claim for reimbursement during the policy tenure. Thus, earning no claim bonus is one of the best ways to slash down on the car insurance renewal premium.
- Easily Transferable- No Claim Bonus is easily transferable to another car when the policyholder replaces his/her old car. It can also be transferred from one insurer to the other if the car owner decides to buy a new policy from another motor insurance company.
- Policy for the Policyholder- The key feature of the No-Claim Bonus is that it is associated with the policyholder, not with the vehicle. In case the policyholder buys a new car, the insurance policy gets easily transferred to the new vehicle number along with the no-claim benefits. Therefore, you get to retain your NCB even if you replace your car with a new one or if you switch to another insurer at the time of renewal of the policy.
Thus, NCB works as an aid for reducing your car insurance premium. It is always advisable to be careful when buying a new motor insurance policy and consider the one that offers a maximum discount bonus. For details about our Motor Insurance Policy, feel free to connect with us.
