No Claim Bonus in Vehicle Insurance: How to Save More on Premiums
- Rohit Lokhande
- Aug 20
- 4 min read
Updated: 3 days ago
Table of Contents
Summary
Introduction
What Is No Claim Bonus in Vehicle Insurance?
How No Claim Bonus in Vehicle Insurance Works
NCB Slabs and Percentage Benefits
Benefits of No Claim Bonus in Vehicle Insurance
Situations Where You Lose NCB
How to Protect Your No Claim Bonus in Vehicle Insurance
Tips to Maximize Savings on Premiums
Common Misconceptions About NCB
FAQ's
Summary
The No Claim Bonus in Vehicle Insurance is a reward offered to policyholders who maintain a claim-free record. This benefit can help you save up to 50% on your premiums over time. In this blog, we explain how No Claim Bonus in Vehicle Insurance works, when it can be lost, and smart ways to maximize your savings.
Introduction
Paying for vehicle insurance every year is a necessity, but did you know that responsible driving can actually lower your premium? This is made possible through the No Claim Bonus in Vehicle Insurance, a discount that rewards policyholders for avoiding claims.
The longer you drive without filing a claim, the higher your bonus grows. Understanding how the No Claim Bonus in Vehicle Insurance works is essential for anyone looking to reduce costs while staying fully insured.
What Is No Claim Bonus in Vehicle Insurance?
The No Claim Bonus in Vehicle Insurance is a discount given by insurers on the Own Damage (OD) premium when you do not raise any claims during the previous policy year.
It’s a cumulative reward.
It applies only to the OD premium, not the mandatory third-party liability premium.
Example: If your OD premium is ₹8,000 and you have a 25% No Claim Bonus in Vehicle Insurance, you’ll pay only ₹6,000.
How No Claim Bonus in Vehicle Insurance Works
After every claim-free year, the discount percentage increases.
If you file a claim, your No Claim Bonus in Vehicle Insurance resets (unless you have protection cover).
It is transferable across vehicles and insurers, making it a personal benefit, not tied to the car.
NCB Slabs and Percentage Benefits
According to IRDAI guidelines, the No Claim Bonus in Vehicle Insurance is structured as follows:
20% after 1 claim-free year
25% after 2 consecutive claim-free years
35% after 3 consecutive claim-free years
45% after 4 consecutive claim-free years
50% after 5 consecutive claim-free years (maximum)
Benefits of No Claim Bonus in Vehicle Insurance
Lower Premiums – Save up to 50% on OD premiums.
Encourages Safe Driving – The more responsible you are, the bigger your reward.
Transferable – Your No Claim Bonus in Vehicle Insurance moves with you to a new car or insurer.
Long-Term Savings – Over several years, the accumulated discount is significant.
Situations Where You Lose NCB
Filing any claim during the policy year.
Policy lapse beyond 90 days after expiry.
Forgetting to transfer the No Claim Bonus in Vehicle Insurance when changing cars or insurers.
Claiming for minor repairs when the expense is lower than the bonus savings.
How to Protect Your No Claim Bonus in Vehicle Insurance
Many insurers offer an NCB Protection Cover. With this add-on, even if you make one or two claims in a year, your No Claim Bonus in Vehicle Insurance remains intact.
Example: You have 45% NCB but claim ₹7,000 for a windshield repair. Without protection, your NCB resets to zero. With protection, your 45% discount is preserved.
Tips to Maximize Savings on Premiums
Avoid filing claims for minor damages; pay from pocket if the repair is cheaper.
Renew your policy before expiry to safeguard the No Claim Bonus in Vehicle Insurance.
Always transfer your NCB when switching insurers.
Consider add-ons like NCB Protection Cover for extra security.
Drive carefully—fewer claims mean bigger rewards.
Common Misconceptions About NCB
NCB applies to third-party premiums → It only applies to Own Damage.
NCB belongs to the vehicle → It belongs to the policyholder.
Small claims don’t affect NCB → Even a minor claim resets it, unless protected.
NCB can’t be transferred → No Claim Bonus in Vehicle Insurance is fully transferable.
FAQ's
1: What is No Claim Bonus in Vehicle Insurance?
No Claim Bonus (NCB) in Vehicle Insurance is a discount offered on the Own Damage premium for maintaining a claim-free year. It rewards safe driving and can go up to 50% after 5 consecutive claim-free years.
2: Does No Claim Bonus in Vehicle Insurance apply to third-party premiums?
No. The No Claim Bonus in Vehicle Insurance applies only to the Own Damage (OD) portion of the premium, not the mandatory third-party liability premium.
3: Can I transfer my No Claim Bonus in Vehicle Insurance to a new car or insurer?
Yes. The NCB belongs to the policyholder, not the vehicle. You can transfer your accumulated No Claim Bonus in Vehicle Insurance to a new vehicle or when changing insurance companies.
4: What happens to my No Claim Bonus if I make a claim?
If you file a claim, your No Claim Bonus in Vehicle Insurance usually resets to zero at the next renewal. However, you can retain it by purchasing an NCB Protection Cover.
5: What is NCB Protection Cover in Vehicle Insurance?
An NCB Protection Cover is an add-on that allows you to retain your No Claim Bonus in Vehicle Insurance even if you make one or two claims during the policy period, helping you safeguard long-term savings.
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