When it comes to insurance for two-wheelers, there are many aspects that a policy buyer must consider apart from the policy premium. One such crucial factor is the NCB i.e., No Claim Bonus as this can play a very vital role in helping policyholders lower their premium every year or increase their insurance cover as well.
What is NCB?
A No Claim Bonus is offered to the bike owner by their two-wheeler insurance company as a form of savings or discount on their insurance premium. This bonus kicks in if the policyholder has made no claims during their policy term and will be discounted from the premium payable during the policy renewal for the following year.
Alternatively, policyholders can also choose to increase their sum insured and get a more exhaustive cover for their vehicle. Policyholders must also remember that the NCB discount is not applicable to Third Party Liability insurance policies.
How to calculate NCB in bike insurance?
No Claim Bonus is offered to insurance policyholders for their own damage cover, in case of a claim-free year. This bonus rate increases by 5% every year.
To better understand this, let’s take the help of this example –
Suppose your Insured Declared Value (IDV) is Rs. 1 Lakh and you are paying a premium of Rs. 14,000 p.a. Now, if you have made no claim on your bike insurance for the first year then you earn a No Claim Bonus that is 20% on annual premium. If you opt for this bonus and want to use it as a discount on your premium for two-wheeler policy renewal next year, then instead of Rs. 14,000 you will pay a premium of Rs. 11,200 only, after factoring the 20% NCB discount.
Additionally, the No Claim Bonus slab is an increasing discount slab for continuous claim-free years achieved by the policyholder. Usually, 50% discount is the maximum that can be availed as NCB in bike insurance. Take a look at the below table to get a clearer idea:
|YEAR||NCB DISCOUNT SLAB|
|First claim-free year||20% of your annual premium|
|Second continuous claim-free year||25% of your annual premium|
|Third continuous claim-free year||35% of your annual premium|
|Fourth continuous claim-free year||45% of your annual premium|
|Fifth continuous claim-free year||50% of your annual premium|
Policyholders must remember that this discount will lapse for any year where insurance claim has been made. The NCB in bike insurance would also be terminated if the policyholder fails to renew the policy within 9 days from the expiry date of the two-wheeler policy.
Q 1. What is eligible NCB in bike insurance?
Ans. A two-wheeler policy holder will be eligible for NCB benefit i.e., No Claim Bonus if they have made no claims on their policy in their previous year.
Q 2. How to find out your NCB percentage?
Ans. You can easily know your NCB (No Claim Bonus) percentage by referring to your NCB slab, which will be mentioned on your policy documents once you have purchased the two-wheeler insurance policy.
Q 3. Can you use the No Claim Bonus on 2 different vehicles?
Ans. You are only allowed to use your No Claim Bonus from one policy on one vehicle at a time. If you want to use NCB for 2 or more vehicles then you need to insure those vehicles as well i.e., buy a separate insurance policy for each vehicle.