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

No Claim Bonus or NCB in a two-wheeler insurance policy is a discount the insurer offers to the policyholder for not raising any claim during the policy term, which is usually a year. Basically, it is a reward for being a responsible rider and keeping the bike safe.

Remember, this discount is only given to the Own-Damage (OD) component of your insurance premium, not the third-party liabilities coverage, a mandatory policy regulated by IRDAI.

Therefore, if you ride your bike safely and do not raise a claim for minor repairs, your NCB accumulates with each passing year, and helps you pay less when it's time to renew your policy.

How Much Can You Save with NCB?

Firstly, the NCB is given in percentage and depends upon how many consecutive claim-free years you have had. It typically builds up in the following manner:

Example: Suppose your bike's own-damage premium is ₹2,500. If you have 3 years of NCB (35%), you'll get a discount of ₹875 on renewal.

How Does NCB Affect Bike Insurance Renewal Premium?

Here's the impact of NCB when you renew bike insurance:

• Reduces the Two-Wheeler Insurance Premium Amount: Your NCB gets deducted from the own-damage part of your premium. So, the more NCB percentage you hold, the less you pay.
• Encourages Safer Riding Practice: Since you save money by avoiding claims, it motivates you to ride your bike more carefully.
• Benefit Increases with Time: The longer you go without making a claim, the higher your NCB percentage will be. Right from 20% up to a maximum of 50%.
• Portable Across Insurers: Even if you plan to switch to a new bike insurance company, you won't lose your NCB. It's carried forward to the new insurer with the help of an NCB certificate.

When Do You Lose Your NCB?

There are certain cases where you lose the accumulated NCB, explained below:

• You make a claim, even for minor repairs. Even one claim during the year can reset your NCB to zero.
• You don't renew your policy within 90 days of expiry, which is the grace period.
• You sell your bike and don't transfer the NCB to your new vehicle.

Can You Protect Your NCB?

In the insurance market, an add-on cover called NCB Protection Cover is available which allows you to raise few claims during the policy period without losing your accumulated bonus, i.e. NCB.

When is NCB Protection Cover Useful?

• If your bike is 2-5 years old and you want to keep your premiums low in future.
• If you ride daily in busy or accident-prone areas.
• If you've built up a high NCB (35%-50%) and want to safeguard it.

Is NCB Under Two-Wheeler Insurance Transferable?

Yes, it is transferable because it is linked to the policyholder/bike owner, not the bike itself. So, you must follow these to enjoy the NCB benefits:

• Transfer your NCB when you change or switch your insurers.
• Transfer your NCB when buying a new bike (provided the name on the policy is the same).
• Get an NCB Certificate from your current insurer to present to the new one during renewal.

Tips to Maximise NCB Benefits

• Avoid Small Claims: If repair costs are minor, paying out of pocket may be smarter than losing NCB.
• Bike Insurance Renewal on Time: Always renew your policy before or within 90 days of expiry to retain your NCB.
• Use NCB Protection Add-on Cover: If you have a high NCB and are worried about losing it after a minor claim, opt for this add-on.
• Compare Bike Insurance Online: While renewing, compare premium quotes from different insurers at Policybazaar. NCB will be considered across all if you have valid proof.

How is NCB Helpful in Reducing Bike Insurance Premium?

NCB is one of the best ways to reduce your bike insurance renewal premium. It rewards you for being a responsible rider and gives you long-term savings without compromising your coverage.

If you've been riding claim-free for years, don't let your NCB go to waste. Make sure to renew your two-wheeler insurance policy on time and avoid unnecessary or minor-repair claims, which can be done on your own.

FAQs - NCB and Bike Insurance Renewal