What is No Claim Bonus (NCB) in Car Insurance? (2025 Guide)
No Claim Bonus (NCB) is a reward offered by car insurance companies to policyholders for driving responsibly and not making any claims during the policy period. It is given as a discount on your next year’s premium, encouraging safe driving habits.
✅ How Does NCB Work?
When you renew your car insurance policy, the insurer checks if you raised any claims in the previous year. If you haven’t, you get an NCB discount on the premium.
📌 NCB Discount Slab in India
- 1st claim-free year – 20% discount
- 2nd claim-free year – 25% discount
- 3rd claim-free year – 35% discount
- 4th claim-free year – 45% discount
- 5th claim-free year – 50% discount
👉 Maximum NCB benefit in India is 50%.
⭐ Benefits of No Claim Bonus
- Significant savings on car insurance premium
- Encourages safe driving and responsible behavior
- NCB is linked to policyholder, not the car – transferable even if you change vehicles
🚗 NCB Transfer Process
If you change your insurance company or buy a new car, your NCB can be transferred. The process includes:
- Requesting an NCB certificate from your old insurer
- Submitting it to your new insurer at the time of policy purchase
- Availing the same discount as per your previous record
⚠️ When NCB is Lost?
- NCB is lost if you make even a single claim during the policy year
- NCB cannot be applied to third-party insurance premium, only to own-damage cover
- If policy is not renewed within 90 days of expiry, NCB lapses
🔍 Final Thoughts
No Claim Bonus (NCB) is an excellent way to save money on your car insurance premiums. By driving carefully and avoiding claims for minor damages, you can enjoy up to 50% discount on your insurance cost. Always remember to transfer your NCB if you switch insurers or buy a new car.
