Benefits of NCB in Long-Term Two Wheeler Insurance

What is No Claim Bonus (NCB) in Two Wheeler Insurance?

No Claim Bonus (NCB) is a type of discount by the insurer to the bike owner who does not raise claims during the policy term. If you renew your policy without making any claim, the next time you renew, you will receive a discount on your premium, which is NCB. Here, the rule is the more consecutive years you go claim-free, the higher the discount you will avail off.

But what about long-term two wheeler insurance policy or multi-year policies? Is NCB rule applied to the same? Let's find out.

Does NCB Apply to a Long-Term Bike Insurance Policy?

Choosing a long-term two wheeler insurance policy (2-year, 3-year, etc.) also offers NCB benefits. Here are a few of them:

• Steady premium savings: Since you don't renew long-term policies each year, there are low processing costs, and you lock in your accumulated NCB.
• Greater discount potential: If you avoid claims over the long term, the NCB percentages you can reach are higher compared to single-year plans.
• More flexibility in claims: Some long-term policies allow a claim early, and you can still retain some NCB in later years if you don't claim again.

How the NCB Rates Scale in Single-Year Policies?

Firstly, to enjoy NCB discount, you must buy two wheeler insurance policy and if you have already one, make sure it is active. 

Here are the typical NCB rates you might see in a standard one-year two wheeler insurance policy if you go claim-free:

If you file a claim in a single-year plan, your NCB typically goes back to 0% for that policy year.

NCB in Multi-Year or Long-Term Bike Insurance Plans

When you buy a 2- or 3-year-long-term bike insurance policy, the NCB rules are slightly different, depending on the insurer. Here is what you get when you opt for a long-term plan:

• If no claims are filed throughout the policy term, you can get a higher discount (often 30–35%) during renewals. 
• If you raise a single claim in the first year of policy and then go claim-free afterwards, then you might still get a decent NCB (discount percentage depends upon insurer) during renewals.
• In case you raise more than one claim, or make multiple claims in later years, the NCB might apply at a lower rate or be forfeited, depending on policy terms.
• In India, some insurers use an incremental NCB model for multi-year plans. For example, no claims throughout the policy period can be 40%, raising one claim means 30%, raising two claims means 20%, etc.

Key Conditions & Limitations Under Long-Term Plans

You must be aware of all key conditions & limitations under long-term plans. In case you miss anything, this might lose your NCB or reduce it. You can also read our article on ‘How to Calculate NCB in Bike Insurance', it explains the calculation methods in detail.

• Filing any claim in a single-year plan typically resets NCB to zero for that year.
• In multi-year policies, more than single claims may drastically reduce the overall accumulated bonus, or even make you ineligible for the NCB.
• Usually, different insurers have different rules on whether minor or partial claims affect NCB. Hence, it is advised to always check policy wording.
• Sometimes, geographic or usage conditions or add-ons may have separate clauses that affect NCB eligibility.

How to Maximise Your Bike Insurance NCB?

In order to maximise your bike insurance NCB, you can follow the steps below:

1. Ride your bike obediently to avoid accidents, hampering your NCB.
2. Maintain your bike well, as any breakdown or damage can lead to claims.
3. Choose long-term policies to get the maximum NCB advantages.
4. If the damage is minor and the repair cost is small, for example, fixing the broken taillight, do it on your own. Sometimes paying out of pocket may be better than raising a claim and losing NCB.
5. NCB builds only when no claims are made in consecutive years/policy terms. Hence, stay claim-free consecutively.

How Much Can You Save With an NCB Discount?

Savings depend on the insurer, bike value, and how many consecutive claim-free years you accumulate. To understand how these factors, reduce your renewal cost, and check our article on the ‘Impact of NCB on Bike Insurance Premium'. 

However, here is the general trend: 

• Receive up to 50% discount on premium of own-damage bike insurance during policy renewal for single-year policies after 5 years of raising a single claim. 
• If you avoid claims for the full policy term in a long-term plan, you may get 30-40% NCB. However, if you make one claim during early years of the policy, subsequent claim-free years can help get you partial NCB.

Tips Before Selecting a Long-Term Policy for NCB

Before buying two wheeler insurance policy, you must keep the following tips in mind: 

• Check the insurer's NCB scale and how they treat claims in multi-year policies.
• Ensure policy terms clearly state how many claims are allowed without NCB loss.
• Compare insurers who may offer better NCB terms & conditions in long-term policies.
• Always keep all your documents in place, such as proof of zero claims, renewal history, etc. All these will be needed during the renewal of the policy.

FAQs –FAQs- NCB Discount in Long-Term Bike Insurance Policy