How Can You Use NCB Of An Old Car To Reduce The Policy Premium Of A New Car?

  • Author :
  • TATA AIG Team
  • Published on :
  • 05/05/2021

Car insurance is a necessary addition to your financial portfolio. If you’ve been torn between the various choices you found while looking to buy insurance, the deciding factor may be whether your policy of choice has a No Claim Bonus.

What is a No Claim Bonus in 4 wheeler insurance?

NCBs are discounts on premiums offered by insurers when you have not made a claim for a few consecutive years. This discount can take the weight off your shoulders when you buy online car insurance.

Car insurance companies offer a No Claim Bonus benefit to customers who have not raised any claims during the policy year. This discount starts from 20% in the first claim-free year and can go up to 50% of the premium amount - the ultimate reward for the small task of driving safely and protecting your vehicle from external harm.

How can you use the NCB of an old car to reduce the premium for new car insurance?**

It is the policyholder who earns the NCB - which means that even if they buy a new car or shift to a new insurer, their reputation for being safe on the road and raising no claims still holds true. This is why many car insurance companies in India offer transferability of the NCB to a new car or for new insurance for a car or upon car policy renewal.

Here’s how you can use the NCB of your old car to get discounted rates of premium on your new 4 wheeler insurance.

1. Earn the NCB on an old car

Ideally, you should have an unbeaten record of not filing for claims if you are a stellar driver. But this does not imply that you go on without raising a claim in a time of crisis where your car is heavily damaged. The idea is that you cover for small repairs and minor dysfunctions yourself without raising claims. This helps you keep the track record for the NCB going.

2. Retain NCB on a New Car or on Car Policy Renewal

When you have accumulated the maximum discount of 50% after five or more consecutive years of not raising claims, you will be able to transfer this NCB of your old car to a new car. This means you can enjoy a discounted premium rate on your new car without having to buy online car insurance again. The same goes for cases where there is a car policy renewal for an existing car. You can keep the streak going and continue to pay just half your premium amount while safeguarding your vehicle.

When is the NCB Certificate Necessary?

Make sure that you acquire the No Claim Bonus certificate that attests to your claim-free streak from your old car insurance provider before you shift to a new one. This document is necessary if:

  • You are buying a new policy from the same insurer, for when you are buying a new vehicle, for instance, in which case you can request an NCB certificate for reference.
  • You are buying a new policy from another insurer, in which case you will need a proper NCB transfer letter that details your claim-free years.

An NCB certificate has a lot of value when you are trying to purchase new insurance for a car because it is a testament to your behavior on the road. Frequent claims will cost a lot for the company as well, which is why they are likely to offer insurance to someone who is more responsible on the road.

No Claim Bonus protector with Tata AIG car insurance

If you’re looking to buy online car insurance, make sure you settle for one that offers benefits like No Claim Bonus. Tata AIG car insurance can be bought in just three easy steps and offers an NCB that is transferable and adherent to the IRDAI regulations. The company prioritizes customer service, performance and integrity, making it a great choice for car insurance.


When buying car insurance, make sure you go for reliable firms like TATA AIG car insurance that offers No Claim Bonuses. NCBs will allow you to save money by offering discounted premiums and incentivize you to drive safely on the streets - it’s a win-win for your family!

A quick recap of the content with some commonly asked queries

Can I transfer my existing car insurance to a new car?

Yes, most companies allow you to transfer an existing policy over to a new car, and they’ll change the policy to reflect the changes. Make sure you let your insurer know about the new purchases.

How do I transfer NCB from an old car to a new car?

If you have the NCB transfer certificate and an attestation from the buyer/seller of the new car, you can retain and transfer the accumulated No Claim Bonus from your old car to your new one.

Can I use my NCB on a second car?

Because the NCB is technically awarded to the policyholder and not to the vehicle itself, you cannot use the NCB on more than one car at a time. Also, keep in mind that if you cancel an insurance policy and switch insurance providers before the policy year is completed, you may not get the NCB for that particular year.

How much do No Claims reduce insurance?

The NCB can reduce the premium amount by up to 50% but will not have any significant effect on the insurance amount you will get upon making a claim. That will be calculated as per the extent of damage to your car and other factors.

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Disclaimer / TnC

Your policy is subjected to terms and conditions & inclusions and exclusions mentioned in your policy wording. Please go through the documents carefully.

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