It's All About Selecting No-claim Bonus (NCB) During Bike Insurance Renewal
Bike insurance is a safeguard against problems that may show up if your bike meets with an unfortunate incident on the road. Hence, Indian Motor Vehicles Act, 1988 makes it compulsory for every biker to seek two-wheeler insurance before hitting the roads. If you follow all traffic rules and ride safely without placing any claim on your insurance company for a given policy year, you become entitled to No-claim Bonus (NCB).
This discount is applicable on the own-damage premium of insurance which can be availed at the time of bike insurance renewal. NCB is denoted by a percentage increasing every consecutive claim-free year up to a limit of 50%. You must specify your NCB percentage in the policy revival form during two-wheeler insurance renewal online.
This post guides you on how to select the correct NCB corresponding to your eligibility for easing the monetary burden during renewal premium payments.
Selecting the Suitable NCB Percentage During Bike Insurance Renewal
You won't be entitled to the NCB during the first premium payment if you purchase a two-wheeler insurance policy for your new bike. Your insurer will reward you for safe and responsible riding once a year has lapsed without any compensation claim.
If you decide to purchase only a third-party bike insurance policy, you cannot benefit from NCB during the next policy renewal. You need to buy a comprehensive bike insurance policy. Specify the NCB based on the eligibility criteria outlined below when renewing your policy.
| Number of consecutive years for which no-claims were made or no-claims are pending with insurer | Accumulated NCB component (discount% on own-damage premium) |
| 1 | 20% |
| 2 | 25% |
| 3 | 35% |
| 4 | 45% |
| 5 | 50% |
You can select the NCB during policy renewal based on the above criteria. Even a single claim, howsoever less in amount, can render your accumulated NCB nil. Hence, it is prudent not to make minor claims on the insurer as you stand to benefit significantly in the form of NCB accumulation.
Selecting NCB After You Have Sold Off Your Insured Bike
You may have accumulated your NCB through cautious and safe riding. However, once you sell off your bike, you stand to lose the NCB benefit during the policy purchase for the new bike. Let this not discourage you. The NCB retention certificate comes to your rescue.
If you are planning to sell your bike and purchase another one of the same manufacturing class, you can request your present insurer to issue you an NCB Retention Certificate. The NCB transfer certificate will allow you to retain the benefit for a maximum period of 3 years.
The steps involved in reserving your entitled NCB for applying for a discount on the new bike's own-damage premium of two-wheeler insurance are outlined below:
- Submit an application to your present insurer requesting the cancellation of your existing bike insurance policy, stating that you intend to sell your bike.
- Attach a copy of the present insurance policy with the application.
- Furnish the duly filled Form 51 (Certificate of Insurance).
- Provide a copy of the delivery note received while selling your bike and a copy of the booking form for a new bike.
- Provide Form 29 (Notice of Ownership Transfer).
- Attach the registration certificate of the old bike with the name of the new owner printed on it.
Once your insurer receives copies of the documents mentioned above along with your application, it will issue you the NCB Retention Certificate within a few days after scrutinizing and verifying the validity of the documents.
You can select the appropriate accrued NCB while buying the insurance coverage for your new bike. This will save you a good amount on the insurance premium payable. Remember, the NCB is provided to the insured person as a reward and is not tied to the two-wheeler which has been insured.
Conclusion
NCB is a certification of your safe and responsible bike riding skills. By staying cautious on the road, you are not only safeguarding your life and bike but also not endangering the lives and properties of others. You get suitably rewarded for your safe temperament with a handsome discount on the bike insurance premium through accruing NCB.
This also motivates you to remain aware of the road while riding your bike. Remember, the NCB becomes nil if you raise even a minor claim with your insurer during the policy year. Also, NCB shall become zero if you fail to renew your two-wheeler insurance policy within 3 months of the expiry of the previous policy.
Add ons for your Two Wheeler Insurance
NCB is applicable on the 'Own-Damage' premium part of the insurance policy. You need to buy comprehensive coverage or add the 'Own-Damage' component to 3rd party bike insurance package to avail of NCB.
The quantum of the claim doesn't matter in determining the eligibility of NCB. Even a single claim, howsoever less, will forfeit your NCB eligibility during the next renewal.
This is because you may be renewing your policy after 3 months. The NCB is valid only for 3 months from the expiry date of the previous policy.
The value of NCB is determined by the number of consecutive years for which you have made no claims on the insurer. It starts at 20% for one claim-free year. For 2, 3, 4, and 5 consecutive claim-free years, you can select 25%, 35%, 45%, and 50% NCB respectively. If the number of claim-free years exceeds 5, the NCB will be fixed at 50%.
You can do so, provided you have secured an NCB Retention Certificate from your current insurer. You have to write an application to the present insurer requesting for cancellation of the policy of the old bike and attach documents like a bike delivery note, registration certificate of the old bike, ownership transfer form, booking receipt of the new bike, etc. The insurer will then issue the certificate after verification which you can use to avail of a discount on the insurance premium of the new bike.