NCB in Bike Insurance

Now, insurers say that if you drive safely and do not raise a claim for a year, on your policy renewal, you will receive a discount on the premium. This discount is called NCB. Formally, an NCB is defined as a discount on premium awarded to the policyholder for not making a claim during the policy year. To deter rogue claims and instill some type of discipline, the concept of NCB was introduced (though we love claims and helping out people!). The good news is, if you continue with good behaviour and if your bike never faces any issues, damage, or accidents, then you can accumulate your NCB over the years.

NCB means, in bike insurance, a bonus discount, which rewards you for not filing claims during a policy period. Therefore, it is quite significant in bike insurance, as NCB helps save money over time by offering a discount on the renewal premium.

Also, NCB benefits in bike insurance are more as they get accumulated over time for all the policy years you don’t make a claim, thus increasing the potential discount to a maximum of around 50% of the policy premium at the end of five consecutive claim-free policy terms.

Don't be greedy because after five years, the discount will not increase, even if you don’t raise a claim in a year. Now let us calculate what the current NCB is in bike insurance with a simple example.

You bought a suave high-speed bike in 2010. There could not be another ideal biker, a.k.a. policyholder, in the world like you. You paid your premium on time. You did not raise a claim in the first year or the second year…or the fifth year. Now, you thought, you have had enough of this bike. You sell this bike and instead bring home another slick model in 2015. You have, along with your new bike, gotten your bike insurance as well. Suppose the own damage premium for the new vehicle is ₹3000. But you have accumulated NCB for 5 years. So, you will get up to a 50% discount on the premium for your new vehicle. You will only have to pay ₹1500 for your own damage premium!

An NCB certificate is provided at the time of buying a two-wheeler insurance policy; it is used at the time of filing a claim or asking for an NCB discount. To get a No Claim Bonus (NCB) certificate, the policyholder must contact the insurance provider and request one. For that, he needs to provide your policy number and personal and vehicle details. After verifying the details, the insurer will issue the NCB certificate.

Yes, there is a way, depending on whether your desired insurance company provides the benefit or not. If your insurer allows it, you can go for an NCB Protect add-on as part of your comprehensive policy. With this feature, you can make a specific number of insurance claims (mostly just one) in a year without losing your no-claim bonus. Some insurers may also put a condition on the number of years you should have gone without making a claim on your policy before the protection feature kicks in.

The NCB Protection Add-on can be bought for an additional premium over the base bike insurance policy. This means that NCB cannot be purchased independently and can only be bought along with a comprehensive or standalone own-damage two-wheeler insurance policy. Also, the premium of NCB varies from insurer to insurer, which is roughly between 5% to 10% above the standard bike insurance policy; you should check the same with your insurer.

The following are some important things to know about No Claim Bonus in bike insurance in India:

• The NCB is available only with the Comprehensive Two-Wheeler Insurance Policy and not with the Third-Party Liability Plan. 
• NCB will terminate if you file a claim even a single time.
• NCB can be easily transferred to the new two-wheeler; just ensure you have the NCB certificate.
• Do not cancel your insurance policy before the end of the policy term as then your NCB will also be cancelled for that year.
• NCB validity is 90 days from the date of expiry of the policy, so remember to renew the bike insurance policy within time.
• It is important to know that you cannot share the NCB benefits between two different bike insurance policies.

So, the next time you are in the mood for some bike racing, remember there is a No Claim Bonus waiting for you on the other side of self-control. Also worth remembering is the fact that this reward is transferable to new vehicles and new insurers. 

Pro Tip! Keep Your NCB. Let go of small change. In other words, in the long run we have seen that making a claim for small damages to the vehicle, that is totally affordable, will make you lose on a substantial chunk of discount on your premium, because the NCB, on even making a single claim will switch back to zero, which looking at the larger picture, will be a bigger financial loss. So, it is best to keep your NCB alive and settle minor damages without raising a claim.