About No Claim Bonus (NCB) protector in Car Insurance

No claim bonus in car insurance is basically the discount offered to the customer by the insurance company at the time of renewal for having no claims in the previous policy years. The No claim bonus is given as discount under the own damage section of the car insurance policy and it ranges from 20% to 50% for every claim free year. The NCB can drastically reduce the premium of the car insurance and save a lot of money for the customer. The NCB discount is over and above the own damage discount offered by your car insurance company.

What is NCB Protector

In a car insurance policy, if you make a claim your no claim bonus becomes Zero. For example you have 25% NCB in your car insurance policy this year and due to an unforeseen situation you had to go for a claim. At the time of renewal your NCB would be 0% as there was a claim in the previous year car insurance policy.

This means you can only claim NCB if there is no claim in the previous year. So the concept of No claim bonus protection has been introduced by the insurance companies in the Indian insurance market to help customers have their NCB intact.

The No Claim Bonus protector helps the customer to protect the NCB in case of up to 2 claims during the policy period. For instance, if you purchase the NCB protector add-on you can claim up to 2 claims in a policy period without losing your NCB. The NCB in your policy is protected with the NCB protector even though there are up to 2 claims in the previous policy year.

Coverage

The NCB protector protects your No claim bonus for a maximum of 2 claims made in the previous policy period. The Own damage claims made for Partial Loss includes Windshield damage, Total Loss and theft of your car or any other accessories in the car. The insured customer will be eligible to carry the NCB for the next year at the time of renewal with the NCB protector in the car insurance policy copy.

Exclusion

This add-on will be not be valid if the vehicle is transferred from one customer to the other. The new customer who had purchased your car will not be eligible for the NCB protection cover as the NCB is given to the driver/owner of the car and is not transferrable to the new driver/owner of the car upon resale of the car.

Need for NCB Protector

No claim bonus ranges from 0% to 50% for each claim free year and is in the slabs of 0%, 20%, 25%, 35%, 45% and 50%. This means that the customer of the car can avail up to 50% discount on the own damage premium if the NCB is carried forward from the previous policy year. The NCB is carried forward from the previous policy year only if there is no claim in the previous policy year. In case of a claim the customer loses his NCB and has to start from 0% NCB.

Since the NCB can go up to 50% for each claim free year, this makes a huge difference in the premium to be paid by the customer. There might be instances where the customer had 50% NCB in his policy copy but had to make a claim due to certain unavoidable situations. In this case he’ll lose his NCB completely and had to pay heavy premium next year at the time of renewal as there is no NCB discount under the car insurance policy copy. Hence there arises the need to have NCB protector to be taken with the car insurance policy.

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