NCB (No Claim Bonus) in Car Insurance
No Claim Bonus (NCB) in Car Insurance
No Claim Bonus (NCB) is a reward given by your insurer for not making claims in the previous year. NCB in car insurance is a discount on the premium amount given while renewing your existing own damage plan. It encourages safe and responsible driving practices while discouraging unnecessary claims.
At TATA AIG, we award a No Claim Bonus from 20% to 50% based on the number of previous claim-free years. The discount starts from the second policy year and compounds over time for up to five years. The benefit is also transferable from one insurer to another and across different vehicles.
Understand the meaning of NCB in insurance, bonus rates, calculation, transferability, and how to maximise your savings with TATA AIG.
How Does No Claim Bonus in Car Insurance Work?
The No Claim Bonus is a reward that reduces your car insurance premium and increases with every year of not filing claims. Check the steps below to understand how it works:
| First Claim-Free Renewal | Second Claim-Free Renewal | Third Claim-Free Renewal | First Claim Filed | Next Claim-Free Renewal |
|---|---|---|---|---|
| A 20% discount applies to the own damage premium | A 25% discount applies to the own damage premium | A 35% discount applies to the own damage premium | No Claim Bonus Resets to Zero | A 20% discount applies once again |
NCB in Car Insurance: Quick Summary
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No Claim Bonus Slab Rates - Year by Year
The No Claim Bonus starts after the first claim-free year of the policy period at the time of your car insurance renewal. Starting from 20%, the NCB increases the discount percentage every year up to 50%. Filing a claim in any year resets the bonus to zero. Here are the IRDAI-approved slab rates of No Claim Bonus in car insurance:
| Policy Age | No Claim Bonus Percentage |
|---|---|
| After 1 year of not filing a claim | 20% |
| After 2 years of not filing a claim | 25% |
| After 3 years of not filing a claim | 35% |
| After 4 years of not filing a claim | 45% |
| After 5 years of not filing a claim | 50% |
Disclaimer: The above rates and the 50% cap are decided by the IRDAI and are the same across all insurers.
Benefits of No Claim Bonus in Car Insurance
| Rewards You for Driving Safely | Savings That Compound Over Time | Bonus for You, Not Your Car |
|---|---|---|
| The No Claim Bonus pushes you to drive safely and responsibly and ensures proper maintenance of your car by offering you a lucrative deal. | Save 20% on premium after the first year of not filing claims. The bonus keeps increasing each year, adding up to a substantial amount over time. | NCB is tied to you, the policyholder and not your vehicle. This means if you sell your vehicle, you retain the bonus and can transfer it to a new car. |
| Let You Transfer Benefits | Ensures That You Stay Covered | |
| NCB in car insurance is a fully transferable benefit. You can shift to a different insurer and retain your old accumulated bonus. | By encouraging you to renew your four-wheeler insurance in time, the NCB ensures you have continuous financial protection from a wide range of risks. |
How Is No Claim Bonus Calculated in Car Insurance?
The No Claim Bonus is a fixed percentage discount that applies from the second policy year onwards. The discount ranges from 20% to 50% on the own damage premium only based on the number of consecutive claim-free years. For a comprehensive insurance policy, it applies to the own damage component and not to the third-party component.
Formula
Here’s the formula to calculate No Claim Bonus:
NCB discount = OD premium x NCB % (as per NCB slab rates)
Example
Suppose the total premium of a comprehensive plan is ₹30,000, with an own damage portion of ₹25,000. After two claim-free years, the No Claim Bonus will be: 25% of ₹25,000 = ₹5,000. Thus, your own damage premium will be ₹18,750, and the total premium will be ₹23,750. Explore the effects of NCB below:
| Policy Year | NCB Percentage | OD Premium After NCB |
|---|---|---|
| 1st Year | Nil | ₹25,000 |
| 2nd Year | 20% | ₹20,000 |
| 3rd Year | 25% | ₹18,750 |
Disclaimer: The above premium prices are for illustrative purposes only.
TATA AIG NCB Protection Cover: What It Is and Who Needs It?
The No Claim Bonus (NCB) protector is a useful add-on that lets you make a claim without losing your accumulated benefits. TATA AIG’s NCB protection cover secures your No Claim Bonus from a single own damage claim during the policy period. At a small cost, car insurance with a No Claim Bonus protection add-on saves your hard-earned discount from being depleted.
What’s Covered?
- The No Claim Bonus protection cover applies only when you have at least two claim-free years.
- The claim cannot be a total loss or a constructive total loss claim.
- Minor claims, including partial theft and damage to windscreen glass or rear glass, are not covered.
- A theft claim will be covered if you buy a new vehicle and insure it with TATA AIG within 90 days of the incident.
- You need to renew the policy within 90 days of the expiry of your previous policy for the add-on to apply.
Who Needs It?
- Anyone with older vehicles prone to minor claims
- Urban vehicles in high-traffic areas
- Car owners who have saved several years of No Claim Bonus
Common Reasons You Can Lose Your NCB in Car Insurance
| After Filing a Claim | After Expiry of Policy | When Your Car Is Stolen | In Case of an Accident |
|---|---|---|---|
| The most common way to lose the NCB is to file a claim without having an NCB protector add-on. | No Claim Bonus is also lost if you don’t renew your car insurance policy within 90 days of expiry (grace period). | If your car is stolen and the insurer has to write it off as a total loss (TL), the NCB benefits are lost. | Some or all of the No Claim Bonus is lost unless the insurer can recover most of the expenses from the other party. |
Rules and Applicability of No Claim Bonus
| NCB Applies to OD Premium | NCB Resets with Any Claim | NCB Is Transferrable with Documentation |
|---|---|---|
| The No Claim Bonus discount applies only to standalone own damage plans and to the OD portion of comprehensive plans. | The No Claim Bonus is reset to zero after any car insurance claim, unless you get NCB protection in car insurance. | Your accumulated NCB benefits can be transferred to a new car or a different insurer within the due date. To transfer, you need an NCB certificate or declaration from the previous insurer. |
| NCB Lapses with Policy Expiry | NCB Can Be Inherited | Declaring Incorrect NCB Attract Penalties |
| If you do not renew your policy within 90 days of its lapse, the NCB benefits will be reset to zero. | If the custody and use of the policyholder’s vehicle passes to new heirs, the NCB benefits can also be inherited. | Make sure to declare the correct NCB for the previous insurer when transferring your policy. Incorrect details can result in claim rejection. |
How to Transfer Your No Claim Bonus to a New Car or Insurer
NCB Transfer to a New Car
1. Get the NCB Certificate: Before selling or transferring your old car, get the No Claim Bonus certificate from your insurer and verify if it has the correct details. 2. Know the Registration Details: Note down the registration number of your new car. 3. Request an NCB Transfer: Submit an NCB transfer request to the insurance provider of your old car. 4. Apply for New Insurance: Buy a car insurance policy for the new vehicle and apply to transfer your old NCB benefits. 5. Submit the Necessary Documents: Submit the NCB certificate, transfer request letter, new car’s registration certificate and old car’s sales agreement to the new insurer.
NCB Transfer to Another Insurer
1. Renew Your Car Insurance: Renew your car insurance policy with a new insurance provider and submit the previous policy number, NCB details and insurer’s name. 2. Declare Your NCB: Submit a declaration to the new insurer stating your NCB bonus and the number of claim-free years of your previous policy. 3. Pay the Premium: Pay the renewal premium with the NCB discount applied to transfer the no-claim discount to your new policy. 4. Keep Necessary Documentation: Keep your old policy documents at hand if needed for verification of your No Claim Bonus.
Documents Required for NCB Transfer
| NCB Transfer Type | Documents Required |
|---|---|
| NCB Transfer to a New Car |
|
| NCB Transfer to Another Insurer |
|
How to Get Your NCB Certificate from TATA AIG
1. Log in to Our Portal: Scroll up and select ‘My Policy’ on the top right. Click on ‘Login’ and enter your registered mobile number and one-time password (OTP).
2. Navigate to Policy Section: After logging in, find the policy section and then the document download section.
3. Request an NCB Certificate: Click on the NCB certificate option in the download section and use your mobile number to confirm your request.
4. Get the Certificate: Your digital NCB certificate will be valid for 90 days from the policy expiry, within which you must renew it. In the case of delays, submit an NCB declaration for your new insurance plan.
How to Check Your NCB Status in Car Insurance
TATA AIG Portal or App
- Log in to the TATA AIG portal or the TATA AIG app.
- Scroll down to the ‘Self-Service’ section and click on Download Policy.
- Enter your registered mobile number and OTP to confirm and download the policy document. Check your NCB discount here.
Calling the Customer Support
- Call our 24/7 customer support helpline (022-6489-8282).
- Talk with our representative to confirm the current status of your policy. The details you will get include your No Claim Bonus.
Policy Document
- Sign in to your TATA AIG account using the above-listed steps.
- Go to the ‘Policy Download’ section and enter your car registration number or existing policy number.
- Click on the download button to save a digital copy of your existing policy document, which contains the NCB discount and claim-free year details.
How to Protect and Maximise Your NCB?
- Renew Your Policy on Time: Make sure to renew your car insurance policy within the 90-day limit before it expires to preserve your NCB.
- Get NCB Protection Cover: Include the car insurance NCB protection add-on during purchase or renewal if you have accumulated 3+ years of benefits.
- Avoid Filing Minor Claims: Since filing any claim eliminates your accumulated benefits, avoid filing claims for minor damages, like small scratches or bumps.
- Drive Responsibly: Following traffic rules and practising safe driving behaviour lowers your chances of getting into accidents and having to file claims.
- Maintain Your Vehicle: Scheduling regular maintenance of your car lowers the chances of mechanical failures and major breakdowns.
NCB Myth Busters
| Myth 1 | Myth 2 | Myth 3 | Myth 4 | Myth 5 |
|---|---|---|---|---|
| NCB applies to the whole premium | NCB Is Lost When Transferring Your Insurer | NCB is depleted Whenever Filing a Claim | NCB is tied to your vehicle | NCB can be sold with your car |
| False, No Claim Bonus only applies to the own damage premium. It does not apply to third-party insurance and only to the OD component of a comprehensive plan. | False, you retain your old NCB benefits when transferring to a new insurer before the lapse of the old policy. | Partially true, NCB is depleted when you file a claim. However, add-ons like NCB protection cover and rim secure retain your bonus after you file a single claim. | False, the NCB in insurance is tied to you, the policyholder and not your vehicle. This lets you transfer it to a new vehicle or another insurer. | False, NCB is transferable but not shareable. Since it’s tied to the vehicle owner, it cannot be transferred to another person except for inheritance after death. |
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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Frequently Asked Questions
1. How can I get 50% NCB in car insurance?
To get a 50% No Claim Bonus, you need to avoid filing claims for five or more consecutive years with your insurance provider. To maximise your chances of avoiding claims, make sure to drive responsibly and avoid making unnecessary claims for minor damages. Protect your bonuses by including a No Claim Bonus protection cover when buying or renewing your plan.
2. How long does it take to get 55% NCB in insurance?
The maximum NCB you can get with a car insurance plan is 50% after five or more claim-free years. You cannot get a 55% No Claim Bonus as the NCB slab rates are fixed across all insurance providers under the Indian Motor Tariff Regulations 2002. India’s insurance regulator, IRDAI (Insurance Regulatory and Development Authority of India), mandates the same NCB rates for all insurers.
3. What are the ways of lowering insurance premiums other than the No Claim Bonus?
Other than the No Claim Bonus, lower your car insurance premium costs by opting for a voluntary deductible, avoiding unnecessary add-ons and selecting a lower Insured Declared Value (IDV) from the permissible range. You can also avail of special discounts by installing certified security devices and joining automobile societies like the Automobile Association of India or the Western Indian Automobile Association.
4. Why is my No Claim Bonus zero at the time of renewal?
There are two main reasons why your No Claim Bonus is terminated. First, the NCB is reset to zero any time you file a car insurance claim without having an NCB protection add-on. Secondly, it’s depleted when you do not renew your policy within the grace period of 90 days. Providing incorrect details or documents while transferring your policy can also eliminate your NCB benefits.
5. How to check the existing NCB in my car insurance plan?
Find the NCB on the first or second page of your policy document. You can also get it through the official website or mobile app of your current insurer in the policy details section. Another way to check your current NCB is to call your insurer’s customer care number, provide some basic details and request policy information.
In addition, you can check the NCB from the Vahan portal or the mParivahan App of the Ministry of Road Transport & Highways. Simply enter your car’s registration number to find the details.
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