There is a buzz associated with NCB. Almost cheerful. Why? NCB is the abbreviation for No Claim Bonus. Yes, you read that right. Bonus. This word has the power to single-handedly brighten your mood, doesn’t it? However, this bonus is not available to everyone, you need to meet some conditions in order to be eligible for it. Read ahead to know why NCB is so important while getting a car insurance.

Why is NCB So Important In Car Insurance? - Acko

What is NCB?

You drive safely for a year and make no claims during the policy period. Your policy period is about to end and it is time for insurance renewal. Your insurer acknowledges the fact that you are a safe driver and wants to reward you for not raising a claim. Thus, the insurer offers you a discount while renewing your policy. This reward is termed as a No Claim Bonus.

How Does It Work?

NCB works just like every other bonus is intended to work. First, it is a reward and second, a motivation to keep repeating the good performance. Thus, by providing an NCB in car insurance, insurers encourage you to drive safe and discourage you to raise claims. This way, a car insurance holder will think twice before raising claims for trivial issues.

How Is It Calculated?

NCB is calculated as per the following table. If you do not raise claims for five consecutive years, you gain a 50% discount on insurance premium. However, the percentage will reset to zero once you raise a claim.

Claim-free renewals

Discount on Premium

On first claim-free renewal


On second claim-free renewal


On third claim-free renewal


On fourth claim-free renewal


On fifth claim-free renewal


Don’t Miss Out On NCB

The key to availing NCB is firstly, not raising a claim and secondly, renewing your car insurance in a timely manner. Your NCB will reset if you fail to renew your car insurance within 90 days of its expiry date. If you purchase a new car, your NCB component can be carried forward to the new four-wheeler as well. Another way of ensuring you do not miss out on NCB is to go for the NCB Protect Add-on.

Protect Your NCB

If you go for a Comprehensive Car Insurance policy, you can choose appropriate Add-ons for wider coverage. The NCB Protect Add-on is designed to keep your NCB component active even if you make a claim during the policy period. Note that the number of claims one can make is at the insurer’s discretion, thus read the terms and conditions carefully before purchasing the Add-on. Usually, two claims are allowed in a policy year.

Online Car Insurance

Now you can buy and renew car insurance online instantly. In most cases, you just have to fill in basic details regarding your car, make the payment, and your car’s insurance policy is emailed to you within minutes. It’s that simple!

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