ARTICLE: No Claim Bonus - How to save on your insurance premiums!

[ajmat]

Do you know you can save as much as 65% on your new car’s insurance? Your insurance agent will never tell you that you can transfer a No Claim Bonus (NCB) from your old car, but a fellow Team-BHPian paid only Rs.10,700 for Rs.27,000 worth of comprehensive insurance on his new car. He just transferred the NCB from his old Maruti Zen to reduce the cost of insurance for his Honda City Vtec. Why didn’t his friendly agent volunteer information about this remarkable deal? Because the more a buyer pays the insurance company, the more commission its agent makes.

Most Indian car buyers negotiate on financing, dealer discounts and freebies but forget about the insurance component.

Team-BHP shows you how to use the NCB to save on your insurance premium:

1. When you sell your old car: The biggest mistake people make is transferring the insurance lock stock and barrel when selling a car. Ensure that ownership is transferred and make a photocopy of the new entry in the RC book for insurance purposes.

2: Obtain the NCB certificate: Forward a copy of the delivery note to your insurance company and ask for the NCB certificate or holding letter. This letter is valid for three years; you may find it easiest to go to your insurer’s local office to pick it up in person.

3: Use the NCB: Forward the NCB letter to your new car’s dealer. Voila! You have just transferred the NCB to your new car insurance and saved a bundle.

Remember to shop around; manufacturers’ insurance schemes are much cheaper than regular insurers’. In one case, insurance for an old Maruti 800 was quoted at Rs.4,800 when the official Maruti insurance was available for just Rs.2,800.

Another process, if you are happy with your existing insurance company, is to go to the insurer with your new car invoice and chassis number. The agent should use your NCB to offer a reduced premium and give you a cover note on the spot. The dealership will need this cover note to register your car with traffic authorities.

Insurance Tip: If you are buying a premium car, it would be wise to opt for zero depreciation car insurance. After all, premium cars are equipped with premium-priced parts. Click HERE (Insurance with 0% depreciation on plastic parts - it really worked for me.) to read up on a positive experience with this type of insurance policy.

FAQ

Q: I have not sold my old car and need to take delivery of a new one.

A: Go ahead and buy the new car: you cannot claim your NCB for the first year but make sure you get the NCB letter when you sell your old car. You can use the letter to reduce your second year’s premium.

Q: The NCB is a major saving – how can I preserve it?

A: A No Claim Bonus means just that – no damage claims on your car. Drive carefully, take security measures to protect your car and claim judiciously. If you have a 50% NCB for your Getz you are saving Rs.9,000. If your stereo is worth Rs.5,000 and gets stolen, do not claim it. Just pay for the new stereo yourself; it will cost less than losing the NCB saving.

Q: I have a cheap Maruti 800 with a 50% NCB and want to buy a Honda City while keeping both cars.

A: One option to consider is to cancel the insurance on your Maruti and claim the NCB certificate for your Honda while insuring the Maruti with a different company. Another alternative is to transfer the Maruti’s ownership and insurance to your spouse or sibling and proceed as above.

Q: What about those free insurance schemes?

A: Try asking for a cash discount instead and buy your own insurance. The next best option is to use the NCB certificate during insurance renewal.

[GTO]

a fellow Team-BHPian paid only Rs.10,700 for Rs.27,000 worth of comprehensive insurance on his new car.

For the record, Ajmat means me. I was about to sign on a 27000 cheque when Ajmat told me "Hey, have you used the NCB option?". Saved 17000 in a shot.

Thanks Ajmat.

[tifosikrishna]

I would like to add one more thing. You are eligible to transfer your NCB even across insurance companies that comes under the GIC umbrella.

To quote an example, my previous car (tata indica) was insured with national insurance, when i sold it, i got the NCB from national insurance and produced the same to my new insurer (United India Assurance), got a Rs.30% or around Rs.8000 on my new car(mahindra scorpio).

regards
tifosi.

[dr fate]

My many thanks for the information,i am cursing myself cause i have never made a claim in my life but i have changed many cars in my life recent one being on 29th last month,

iam thinking how much i could have saved if this article had come earlier sigh......

[nitrous]

Same here.
Its a major eye-opener for me. I never knew this existed.

[BMW]

Thanks ajmat! Never knew about this...

[ScarySkulls]

I am currently in the 65% rebate bracket.
Never claim for any minor damages. Saves you LOTS in the long run.

[ajmat]

Originally Posted by ScarySkulls

I am currently in the 65% rebate bracket.
Never claim for any minor damages. Saves you LOTS in the long run.

.............and you get better treatment in the unlikely event of having to make claim. The MNC insurance companies have long memories

[aZa]

nice stuff ajmat... !!! major eye opener

[w 12]

I have a NCB of 65% in my car insurance ... Not one claim over past 11 years and 5 cars

Have been transferring insurance to the latest car to take benefit of this..

Another trick if you have more than a car in your name - transfer the policy with highest NCB to the most expensive car in your house..and take a new policy at the depreciated cost of the old car.. you will definitely save some money.

( you can transfer your 2 wheeler insurance as well !! )

[sportive_guy30]

Thank you very much ajmat. I made this mistake.

w 12: you said...>> you can transfer your 2 wheeler insurance as well !!

Is this possible? So can use my Splendor NCB for new honda city? Has any one used existing two wheeler NCB for car? If yes how much can we save?

Please let me know.

Thanks.

[GTO]

Think about it:

1. Its only logical that the risk (and therefore premium) on no-claimers should be less.

2. Its also a way for Insurance co's to demotivate you from making frequent claims. When a coconut broke the rear windscreen of my Honda, I didnt claim.

[w 12]

Originally Posted by sportive_guy30

Is this possible? So can use my Splendor NCB for new honda city?
Thanks.

I meant you can transfer the insurance of your old 2 wheeler to that of your new upgraded one , when you buy one , maintaining the same no claim bonus as the old one.

I dont think you can transfer NCB from 2 wheeler to 4 wheeler.

For example My Bullet although only 3 years old , has a NCB of 65% as I transferred same ploicy from My Earlier Shaolin - Shogun -kinetic honda - RD 350

[black12rr]

Gurus one more info need . Does NCB % increase every year ?
Like for example this year the insurance compay will give 5 % NCB .
Next year if you dont claim anything ,it will be 10 % and next year 15 % and so on ?
Awesum ,i love this forum

[hyper-VTEC]

Wow! I never knew that NCB can be transferred. So if i have 30% on my existing WagonR and i decide to go for a new car, and transfer the NCB, they deduct 30% from the total insurance amt. of the new car? Thats awesome ajmat...Thanks