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What is No Claim Bonus (NCB)?

No Claim Bonus (NCB) is the bonus accrued to an insured for not making any claims during the previous policy period which is extended as a % discount on the premium paid during renewal. As per current norms in India, it ranges from 20% on the Own Damage premium (and not on Liability premium) and progressively increases Year on Year of no claim to a maximum of 50%.

NCB is given to the insured and not to the insured vehicle. Hence, on transfer of the vehicle, the insurance policy can be transferred to new owner but not the NCB. The new owner has to pay the NCB on Pro-rata basis for the balance policy period. The original owner can avail the NCB in the insurance premium while purchasing another vehicle.