No Claim Bonus (NCB) in Two-Wheeler Insurance

NCB stands for No Claim Bonus. A two-wheeler policyholder is eligible for this benefit if they do not register any claim in the previous policy period. For this reason, sometimes the policyholder decides to bear the expenses of repair of the bike on their own instead of filing a claim with the insurance company. In such a scenario, they are eligible for NCB, which is a percentage concession on the renewal insurance premium amount. This markdown is applicable on the 'Own Damage Premium' component of the insurance plan and usually ranges between 20% and 50%.

What is NCB in Bike Insurance?

NCB, or No Claim Bonus, is a reward offered by bike insurance companies to policyholders who do not make any claims during the policy period. It is a discount on the renewal premium for the next policy term, given as a percentage based on the number of claim-free years. The discount can range from 20% to 50%, depending on the number of consecutive claim-free years. For example, after one claim-free year, you may get a 20% discount, which increases as the claim-free years accumulate. NCB helps reduce the overall cost of bike insurance, making it a valuable benefit for responsible riders. However, it’s important to note that if you make a claim during the policy period, you lose the NCB, and the renewal premium may increase.

How Does NCB Work?

No Claim Bonus (NCB) is a reward given by insurers to policyholders who do not make any claims during their bike insurance policy period. When you maintain a claim-free record, you become eligible for an NCB discount on your policy renewal. The discount increases with each consecutive claim-free year, typically ranging from 20% to 50%. For example, after one claim-free year, you may get a 20% discount, while two claim-free years could earn you a 25% discount. This incentive encourages responsible riding and helps reduce the overall premium cost. However, if you make a claim, you lose the accumulated NCB, and your premium will increase during the next renewal. NCB thus benefits those who avoid claims, rewarding them with a lower premium for their policy renewal.

Why is NCB important for two-wheeler insurance?

NCB plays an important role in lowering the two-wheeler insurance OD premium amount. It is a great way to progressively save on the premium during two-wheeler insurance renewal as the percentage of this bonus increases with consecutive claim-free years.

Importance of NCB for Bike Insurance

The No Claim Bonus (NCB) is an important aspect of bike insurance as it directly impacts the cost of your premium. Here's why it's crucial:

1. Premium Discount: NCB offers a significant discount on your bike insurance premium, which can range from 20% to 50%, depending on the number of claim-free years. This helps reduce the overall cost of renewing your policy.
2. Encourages Safe Riding: NCB motivates riders to be more cautious and responsible on the road, reducing the chances of accidents or claims. It rewards careful driving and discourages reckless behavior.
3. Incentive for Policyholders: For those with a good claim history, NCB is a great financial incentive that reduces the burden of high premiums in subsequent years.
4. Long-Term Savings: The longer you maintain a claim-free record, the higher the discount, leading to substantial savings over time.
5. Improved Policy Benefits: NCB helps in building a good relationship with the insurance company, ensuring smoother policy renewals with reduced costs.

How to Check NCB in Bike Insurance?

1. Review Your Policy Document: Your bike insurance policy document should mention the NCB eligibility and the applicable discount based on your claim history. Check the section that details the premium breakdown or renewal terms.
2. Contact Your Insurance Provider: If you’re unsure about the NCB details, reach out to your insurance provider directly. You can either call their customer service number or visit their website for assistance. They will verify your claim history and inform you of the discount you’re eligible for.
3. Check Online Portal: Many insurance companies offer an online portal where you can log in and check the status of your bike insurance policy, including the NCB. Here, you can also track your claim history and see how it affects your upcoming premiums.
4. Ask for NCB Certificate: If you plan to switch providers, you can request an NCB certificate from your current insurer. This certificate will confirm your claim-free years, which can be shared with the new insurer to avail the NCB benefit.

Benefits of No Claim Bonus in Bike Insurance

No Claim Bonus (NCB) is one of the most significant benefits offered by bike insurance providers. It is a reward for policyholders who have not made any claims during the previous policy term. The following are some of the benefits of NCB:

1. Concession on premium

Policyholders who have a good driving record and have not made any claims during the previous policy term are eligible for a markdown on their premium. The rate of concession increases with the number of claim-free years.

2. Higher savings

NCB helps policyholders save money on their premiums, which can be used for any purpose they wish.  These savings can be used for other expenses for your car or make investments in different avenues.

3. Easy renewal

Policyholders who have NCB can easily renew their policy without having to go through the lengthy process of filling out forms and providing documentation.

Impact of NCB Discounts on Premium Calculation

No Claim Bonus (NCB) can have a significant impact on the calculation of premiums for bike insurance. NCB is a reward offered to policyholders who have not made any claims during the previous policy term. The percentage of the benefit increases with the number of claim-free years. For example, if a policyholder goes for a consecutive five years without making any claims, they may be eligible for a 50% concession on their premium. These savings can bring down the overall cost of the policy, thus, making it more affordable for policyholders who have a good driving record. Also Read: 9 Common Mistakes to Avoid When Renewing Bike Insurance

How to Calculate NCB for Bike Insurance?

The calculation of the NCB is done as shown in the table below:

20% markdown on OD Premium	No claim made or pending during the preceding full year of insurance
25% markdown on OD Premium	No claim made or pending during the preceding 2 consecutive years of insurance
35% markdown on OD Premium	No claim made or pending during the preceding 3 consecutive years of insurance
45% markdown on OD Premium	No claim made or pending during the preceding 4 consecutive years of insurance
50% markdown on OD Premium	No claim made or pending during the preceding 5 consecutive years of insurance

Things to Remember About NCB in Bikes

1. NCB becomes nil in case the policyholder files a claim.
2. NCB can be transferred to the new vehicle in case of substitution of the vehicle of the same class.
3. The validity of NCB is 90 days from the date of expiry of the policy. Therefore, you should renew the two-wheeler insurance policy in time to avail of this benefit of NCB.
4. NCB can be utilized within three years when the existing vehicle is sold and replaced with a new vehicle.
5. NCB recovery can be done in case of a name transfer on the RC of the vehicle.

Two-wheeler insurance is an important investment for every bike owner. Opt for online 2-wheeler insurance as it is quick and hassle-free. Also Read: How To Check Bike Insurance Policy Status Online

Frequently Asked Questions on No Claim Bonus (NCB)

1. What is a No-Claim Bonus (NCB)?

NCB is a reward offered to policyholders who have not made any claims during the previous policy term. It is a reward for, essentially, being safe on the road and maintaining a good driving record.

2. How is the No-Claim Bonus calculated?

The NCB is calculated as a percentage of the own-damage premium. The percentage increases with the number of claim-free years. For example, if a policyholder gets the NCB benefit, they receive a concession of 20% on their own-damage premium. If they do not make a claim for five consecutive policy years, this rate increases to a maximum of 50%.

3. Is NCB transferable from one bike insurance policy to another?

Yes, NCB is transferable from one Bike Insurance Policy to another. Policyholders can carry forward the NCB discount to their new policy.

4. Can I claim NCB if I have made a claim during the previous policy term?

No, NCB is only available to policyholders who have not made any claims during the previous policy term.

5. Can I get NCB for second-hand bike?

To get NCB benefits for a second-hand bike, you will have to ask your insurance provider for the NCB retention certificate.

6. Can I use the NCB for more than two vehicles or bikes?

Yes, you can use your NCB on multiple vehicles, provided you have separate insurance policies for each vehicle. The NCB can be transferred individually for each bike or vehicle, depending on the insurer's terms.

7. Can I transfer the NCB when I purchase a new bike?

Yes, you can transfer the NCB to a new bike, provided you are purchasing the new bike within a certain period (usually within 90 days) from the previous policy's expiry. You will need to submit your previous policy details to your new insurer.

8. Does NCB expire?

Yes, NCB typically expires if there is a gap in your insurance policy. If you don’t renew your bike insurance within the grace period, you may lose your NCB.

9. What are the NCB transfer rules?

NCB transfer rules allow you to transfer your claim-free bonus to a new insurance provider if you switch insurers. You need to provide an NCB certificate from your previous insurer.

10. Do I lose my NCB if someone hits my bike?

If your bike is hit by someone else, and the damage is claimed through their insurance, you will not lose your NCB. However, if you claim from your own insurance, the NCB may be affected.

11. How long is no claim bonus valid?

The validity of the NCB is usually one year. If you don’t renew your insurance policy before the expiry date, you may lose the NCB.

12. What is the maximum withdrawal from NCB?

The maximum NCB discount can range from 20% to 50%, depending on the number of claim-free years you have. The more years without a claim, the higher the NCB discount.

13. How is no claim bonus calculated?

NCB is calculated based on the number of consecutive claim-free years. Generally, after each claim-free year, your discount increases in increments (e.g., 20% after one year, 30% after two years, and so on). 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.