Car Insurance - Possible NCB (No Claim Bonus) Loophole?

[koshyjohnuk]

Can't you buy a really cheap vehicle (Nano, or a terribly cheap bike?) simply for the purpose of accumlating NCB in anticipation of purchasing a very expensive vehicle? And then transfer the NCB to the new expensive car (Merc, BMW, Bentley?) when you purchase it?

You could very well save a tidy sum. Heck, you could run a business of purchasing cheap vehicles to accumulate NCBs and then sell these vehicles with the NCBs included to people who are going to buy expensive cars.

It just seems so obvious to me - maybe I'm overlooking something here...

[ACM]

Originally Posted by koshyjohnuk

Can't you buy a really cheap vehicle (Nano, or a terribly cheap bike?) simply for the purpose of accumlating NCB in anticipation of purchasing a very expensive vehicle? And then transfer the NCB to the new expensive car (Merc, BMW, Bentley?) when you purchase it?

You could very well save a tidy sum. Heck, you could run a business of purchasing cheap vehicles to accumulate NCBs and then sell these vehicles with the NCBs included to people who are going to buy expensive cars.

It just seems so obvious to me - maybe I'm overlooking something here...

Seems logical and seems possible. Nice Idea. Lets get into business...

[ajmat]

You cannot transfer the NCB to others. It is applicable to vehicles owned by you only

[ajay99]

Originally Posted by ajmat

You cannot transfer the NCB to others. It is applicable to vehicles owned by you only

yes, you cannot transfer NCB, but it will remain with you even if you dont own a car for 3 years.

[oss]

NCB is on the driver of the vehicle; not on the vehicle itself.

It stays with the initial owner of the car even when the ownership changes. Infact not many dealers update the buyers of this, and when someone with few years worth of NCB buys a new car, most of the people end up paying the full insurance amount, without claiming the NCB they have accumulated over the years.

[bblost]

Originally Posted by koshyjohnuk

Can't you buy a really cheap vehicle (Nano, or a terribly cheap bike?) simply for the purpose of accumlating NCB in anticipation of purchasing a very expensive vehicle? And then transfer the NCB to the new expensive car (Merc, BMW, Bentley?) when you purchase it?

Yes you can transfer the NCB accumulated on your car to your new car, provided you sell off the old car.

For example you have a m800 with the highest % of NCB.
You can sell the car to your spouse.
He or She will need to pay the premium without NCB benefit unless they are transferring their own to it.
Your new car insurance will get benefited by your accumulated NCB.

Heck, you could run a business of purchasing cheap vehicles to accumulate NCBs and then sell these vehicles with the NCBs included to people who are going to buy expensive cars.

When you sell off a car the insurance is not transferred with it. The new owner needs to purchase it fresh


Also, I doubt if you will be able to transfer the benefits accumulated on a regular car to an exotic. AFAIK exotics are taken as a special case and deals done on a case to case basis.

[ACM]

1) When I picked up a 2 year old vehicle and go the insurance transferred to my name, Did not have to pay a charge for it except agent charges. (there was only 2 months remaining.)
2) When I renewed the insurance (with another company) for the first time for this 2 year old vehicle, they offered me a 2 year NCB benifit even though it was the first car taken on that persons name. (ICICI)
3) On the other hand when I tried to transfer the 5 years NCB on my company provided car to my name when the car was transfered I was not able to do it. (New India Assurance)

[koshyjohnuk]

Originally Posted by ajmat

You cannot transfer the NCB to others. It is applicable to vehicles owned by you only

Ah! That's the catch!

Originally Posted by bblost

Also, I doubt if you will be able to transfer the benefits accumulated on a regular car to an exotic. AFAIK exotics are taken as a special case and deals done on a case to case basis.

Can anyone elaborate on this? How about from bikes to cars?

Here's my creative mind going further: (if it is not possible to transfer from bikes to cars) Somebody should make the world's (new) cheapest car just for aforementioned NCB purposes - four wheels, 100cc engine (just to get to the RC office; you can possibly send the engine back to the company to fit onto the next car they "produce"), 2 plastic seats, ..you get the drift. No warranty, no customer support. It'd be so cheap and insurance would be a joke.

4 years later, walk into the local Merc dealership, save on insurance, start paying full premium on the "joke" car for you next luxury car after 3 years.

This is all purely academic discussion. I am beating this to death to figure out why some enterprising Indian has not seen the potential for this. Only reason I can think of is possibly because the insurance companies will eventually figure out what's happening.

Originally Posted by ACM

1) When I picked up a 2 year old vehicle and go the insurance transferred to my name, Did not have to pay a charge for it except agent charges. (there was only 2 months remaining.)
2) When I renewed the insurance (with another company) for the first time for this 2 year old vehicle, they offered me a 2 year NCB benifit even though it was the first car taken on that persons name. (ICICI)

So you got the NCB benefits? Even though logic says you shouldn't have.

Originally Posted by ACM

3) On the other hand when I tried to transfer the 5 years NCB on my company provided car to my name when the car was transfered I was not able to do it. (New India Assurance)

So you are implying it is all down to insurance companies? Or that it could even be down to chance?

I don't understand the business logic of an insurance company accepting the NCB given to a previous customer of another company. Is there some sort of agreement where the new insurance company gets some money from the company which issued the NCB? I understand that a customer with a NCB is statistically less likely to get into an accident, but is that all they want?

[rjvora_2000]

What a logical - illogical discussion going on in this thread.

1. I am wondering a person buying Merc. or BMW will think so much for insurance?

2. NCB is just a free bee and nothing else and the logic is very simple if a person owning the car have not claimed anything he is given this NCB.

3. If he is selling his car and buying other car then NCB can be transferred form old insurance policy to new insurance policy.

4. Noting....

[SilentEngine]

What happens when a person has two vehicles in his name?
How is the NCB calculated then?
Will the NCB of one car affect the other?

[rjvora_2000]

Originally Posted by SilentEngine

What happens when a person has two vehicles in his name?
How is the NCB calculated then?
Will the NCB of one car affect the other?

No, it doesn't. - My opinion. I also need to cross check this but Logically it should not.

[oss]

Originally Posted by ACM

1) When I picked up a 2 year old vehicle and go the insurance transferred to my name, Did not have to pay a charge for it except agent charges. (there was only 2 months remaining.)
2) When I renewed the insurance (with another company) for the first time for this 2 year old vehicle, they offered me a 2 year NCB benifit even though it was the first car taken on that persons name. (ICICI)
3) On the other hand when I tried to transfer the 5 years NCB on my company provided car to my name when the car was transfered I was not able to do it. (New India Assurance)

That was actually wrong. Not surprised that it happened though, as many time even the staffs are not aware or they don't bother, as it involves more paper work.

In the first case you are not eligible for the NCB. In the second case you are indeed eligible. All you need to do is get a letter from your company indicating that the car was provided to you and you were using it for the last 5 years, and that they have no objection in transferring the NCB accumulated to your new insurance.

[xingamazon]

Sorry for being naive. What does NCB stand for.

[amanmalhotra]

Originally Posted by oss

That was actually wrong. Not surprised that it happened though, as many time even the staffs are not aware or they don't bother, as it involves more paper work.

Well, the staff makes a fat commission based on the premium that you pay. So, higher the premium higher the commission. In case you were to tell them to manage it, they would do it rather easily. Just that, it doesn't make financial sense for them personally.

[humans]

Originally Posted by xingamazon

Sorry for being naive. What does NCB stand for.

NCB stands for No Claim Bonus