1. What is No-Claim Bonus (NCB)?

The No-Claim Bonus (NCB) is a discount on your car insurance premium that you earn for each claim-free year. It's a reward for safe driving and not making any claims on your insurance policy.

2. How NCB Calculation Works

The calculator uses the following formula:

Where:

• \( Premium \) — Your annual insurance premium amount
• \( Discount\ Rate \) — Percentage based on claim-free years:
  • 1 claim-free year: 20% discount
  • 2 claim-free years: 25% discount
  • 3 claim-free years: 35% discount
  • 4 claim-free years: 45% discount
  • 5+ claim-free years: 50% discount (maximum)

Example: If your premium is $1000 and you have 3 claim-free years, your NCB would be $1000 × 0.35 = $350, making your discounted premium $650.

3. Importance of NCB

Details: NCB can significantly reduce your insurance costs over time. It's transferable between insurers and can save you up to 50% on your premium after five claim-free years.

4. Using the Calculator

Tips: Enter your current insurance premium amount and select how many consecutive years you've been claim-free. The calculator will show your NCB amount and discounted premium.

5. Frequently Asked Questions (FAQ)

Q1: Does NCB apply to all types of car insurance?
A: NCB typically applies to comprehensive and third-party policies but may not apply to short-term or temporary insurance.

Q2: What happens if I make a claim?
A: Making a claim usually resets your NCB to 0%, though some insurers offer protection options to preserve your bonus after one claim.

Q3: Can I transfer my NCB to another vehicle?
A: Yes, NCB is tied to the policyholder, not the vehicle, so you can transfer it when you change cars.

Q4: Does NCB expire if I don't renew immediately?
A: Most insurers allow a grace period (typically 90 days to 2 years) before your NCB expires if you don't renew.

Q5: Is NCB the same in all countries?
A: No, NCB rules and discount percentages vary by country and insurer. This calculator uses common international standards.