What Is A No-Claim Bonus?

A No-Claim Bonus (NCB) is a reward offered by insurers for maintaining a claim-free record. Each year you don’t claim, you earn a discount on your insurance premium—an incentive for safe and responsible behavior.

How the No-Claim Bonus Works

• Each claim-free policy year typically earns a percentage discount, starting from around 10% and increasing with each additional year.
• If you make a claim, your NCB may reset or reduce depending on your insurer’s policy.
• NCB usually applies to comprehensive car insurance policies, not third-party liability only.
• In many cases, you can transfer your NCB when switching insurers or vehicles.

Benefits of Earning NCB

• Reduces your premium each year
• Encourages safe and responsible driving
• Often transferable when switching insurers

Drawbacks to Consider

• Minor claims may reduce or eliminate your bonus
• Not all non-fault claims preserve your NCB
• NCB can expire if you don’t renew or hold a policy for an extended time
• Claiming may reduce your long-term savings on premiums

Tips to Maximise Your NCB

• Consider paying for minor repairs out of pocket to preserve your NCB
• Review NCB protection options before claiming
• Compare insurers’ NCB policies to get the best value

Final Take

A no-claim bonus can significantly lower your car insurance premium over time. By understanding how it works and using it strategically, you can enjoy cost savings and added peace of mind. Always review your policy's terms before claiming to ensure you’re making a financially sound decision.