What is a No Claim Bonus (NCB)?
A No Claim Bonus rewards you for a claim-free year. In health insurance it usually increases your sum insured at no extra premium; in motor insurance it is a discount on your own-damage premium. Making a claim can reduce or reset the accumulated bonus.
NCB in health insurance
For each claim-free year, many health plans add a percentage to your sum insured, up to a cap, giving you more cover for the same premium. If you claim, the bonus may reduce, though some plans protect it.
NCB in motor insurance
In car and bike insurance, NCB is a discount on the own-damage part of your premium that grows with each claim-free year up to a maximum. A single claim can reset it to zero at the next renewal, which is why small claims are sometimes not worth making.
Example
A motor policy with a 50% NCB gives a large discount on the own-damage premium. One small claim can reset that to 0%, so a Rs 8,000 dent claim can cost far more than Rs 8,000 in lost bonus over the next years.
Common mistakes
- Making a small motor claim without checking how much NCB you would lose.
- Letting a motor policy lapse, which can forfeit accumulated NCB.
Frequently asked questions
Do I lose my No Claim Bonus if I make a claim?
Usually yes, unless you have an NCB-protection add-on. In motor insurance a claim often resets NCB at renewal; in health insurance the accumulated bonus may reduce.