Understanding Two-Wheeler Insurance Terms: No Claim Bonus

Two-wheeler insurance is a kind of insurance policy wherein the policyholder receives financial compensation when their bike gets damaged in a manner covered by the policy. For you to receive this compensation, a claim has to be raised. The money provided to the policyholder is taken from the sum insured of the insurance policy. The higher the sum insured, the more will be the premium. However, there is one very effective way of reducing the premium amount while still retaining the sum insured of your choice and that is to take advantage of the NCB or the No Claim Bonus feature.

How does the NCB work?

The NCB is a bonus component in a two wheeler insurance plan provided to the policyholder when they do not raise any claims during the policy duration. When you do not raise a claim with the insurer at all during a year, the sum insured stays untouched. This is beneficial for the insurer and is also a sign of how well you drive and maintain your vehicle. While some insurers deliver the NCB via an increment in the sum insured, others offer concessions on the bike insurance price, that is the premium amount.

Features of the No Claim Bonus

  • Cumulative in nature

The NCB is cumulative in nature, that is, it increases with each claim-free year. So, if you do not raise a claim in one year, you receive a 20% markdown on the premiums for the policy. In the second claim-free year, the savings increase to 25% and to a whopping 35% after the third claim-free year. The concessions can reach up to 45% and 50% after the fourth and fifth claim-free years, respectively. A single claim can lead to the loss of the entire amassed savings. The maximum concession that the NCB can avail of on the bike insurance price is 50%. *

  • NCB applicable only for comprehensive motor insurance

The NCB is applicable only if you have a comprehensive bike insurance policy that covers your own damages as well. A third-party bike insurance policyholder is not eligible to receive the NCB regardless of whether they have made a claim or not. This is largely so because the third-party premiums are fixed by the IRDAI and are standard across all insurers. There is no scope for modification in the third-party premium. You can visit the official website of IRDAI for further details. *

  • NCB is retained during policy portability

If you have amassed a considerable NCB concession and are switching from one insurance provider to another, then you will be glad to know that the NCB will be retained, even with the new insurer. The NCB is attached to the owner and is indicative of their performance and not the insurance policy or the company. *

  • NCB may be lost if policy is not renewed on time

If you want to continue enjoying the benefits of your NCB savings, then you should remember to do your bike insurance renewal on time. If the policy lapses, so do the savings on the premium that you had accumulated with the NCB. Note that the NCB clause may differ from insurer to insurer. Kindly have a talk with your insurer about it before you go ahead with your policy. *

* Standard T&C Apply

Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.