Car Insurances 246 views
When you look to buy car insurance, the focus remains entirely on the premium amount that you will have to pay. Car insurers, with a view to get more customers on the board, introduces discounts on premiums from time to time. One prominent discount offering comes in the form of No-claim Bonus (NCB). Most of the people must be aware of the concept. But often it is found that insurance buyers do not understand the criticality of NCB and that eventually leads to the complications in the renewal of the policy. As a car insurance buyer, you must get acquainted yourself with various aspects concerning NCB in order to avail the benefits in totality. Below are the list of interesting facts with respect to NCB that you must consider.
NCB only available during policy renewal
NCB, which is the discount receivable on not claiming in the previous years, ranges from 20-50% on the premium that you will pay. Plus, it is not the right that you can enjoy. You have to earn NCB by maintaining claim-free periods. While buying the first comprehensive car insurance policy, you are not entitled for NCB on the premium payment as you won't be having claim-free status. However, in the rare incidence of NCB transfer, the discount can be availed. You can avail an initial NCB of 20% during the first policy renewal on the condition of no claim made during the last year. With every claim-free year, your discount can go up to 50% after 5 claim free years.
NCB belongs to policyholder and not car
NCB belongs to the policyholder and not the car, a prominent feature associated with the concept. So, you can retain your NCB upon the replacement of your existing car with a new or during the time of switching to other insurer at the time of policy renewal. The transfer of NCB is quite simple. Suppose if you bought the car in 2010, which was sold in 2015. And you do not make a claim during the five-year period, you are eligible for an NCB discount that can go up to 50%. You are allowed to transfer NCB availed on previous car insurance policy to the new one on the first premium payable with the latter. However, NCB is not transferable from one person to another except to the legal heir if the other individual inherits the car on the death of the policyholder.
You can protect your NCB and keep a certain amount of at 'fault incidents' with no effect to the bonus. Thus, the NCB remains even when your car meets an accident. However, you will have to contend with different rules of the insurers regarding the number of claims that can be availed. Plus, the premiums can go up after the claim as the insurers keep an eye on your claim history before calculating the premiums. The calculation of the NCB is made in the end.
Avail NCB accumulated on company car
You can avail NCB accumulated on the company car, which you would have returned. However, in order to enjoy NCB discount, your name must have been there in the insurance policy of the company with respect to the specific car. Moreover, the policy must have clearly stated that the car was exclusive for your personal purpose.
NCB not applicable for 3rd party cover
Applicability of the NCB discount is confined to the own damage premium component and does not have anything to do with the 3rd party liability premium that contributes up to 20% of the overall premium.