Home Insurance Vehicle Insurance Minor Repairs Claim vs No Claim bonus

Minor Repairs Claim vs No Claim bonus

When you take a new vehicle the first thing that we do without fail is insure it against any damage or accident. Getting vehicle insurance for your car is equally important to secure your life and the life of a third person if involved.

But you need to be sure of the circumstances and the extent of damage caused that lets you go forward with the claim or deny it. Here in motor vehicle insurance policy we have No Claim Bonus and Minor Repair Claim, read on to find more about it.

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What is No Claim Bonus (NCB)?

No Claim Bonus or NCB is when you have not claimed your car insurance in the previous year; you will be entitled to a discount in the next year’s premium amount. This discount is called rightly as No Claim Bonus or No Claims Discount.

Almost all car insurance premium shave two portions; own damage premium and third party premium. NCB is often applicable to own damage premium that comprises more than 80% of total car insurance premium and the rest of the 20% is made up by third party premium. But once you claim your insurance, the NCB becomes zero and you will have to pay a higher premium next time.

Benefits of No Claim Bonus

The discount for bonus starts from 20 % and goes up to 50%.But the more claim free years you enjoy, you gain more discounts on premium. NCB is your reward for driving with caution and for being a good driver thereby saving on your motor insurance.

NCB is linked to the insured’s driving and his claim history and not the vehicle and hence there is an option to transfer the NCB from one insurer to another and also to a new vehicle of the same type from the old thus saving on the first insurance cost of the new vehicle (from an old two wheeler to a new two wheeler).

Never Claim for Minor repair works

If your vehicle has minor dents or scratches, it is always best not to claim it from the insurance as such small requirement of money will take long delays and the entire process is tiresome. Instead of claiming from your insurance agent for that minor repair, it is always best to get it repaired from a mechanic and pay from your own pocket, which will not cost you much.

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Also by claiming even for a minor repair lets you lose to the No Claim Bonus and ends up in you paying a higher premium when you renew your insurance policy.

Hence it the damage caused to your vehicle is minor it is always best to not claim it as you will lose out on the No Claim Bonus, which is even more beneficial for you.

2 COMMENTS

Kitty Macalpine February 13, 2016 at 11:52 pm

I am not very comfortable with no claims bonus. We buy car insurance so we can cover the cost of anything that happens to our car. So we end up paying for insurance, plus our car repairs out of the same pocket.
It is best to analyse like this:
Will the cost of you paying for minor repairs alone be greater than the discount your receive the next year? If it is a greater cost than the discount, best to claim the repair and keep paying full price.

Vandana Agarwal June 23, 2016 at 2:32 pm

A very practical approach to the problem of claiming car insurance. The athor’s advise is suitable only if the damages are minor, it is better to spend than to pay a high premium the following year. But then some policies might be there that overcome this problem too.