Insurance of any type of vehicle is mandatory under the Motor Vehicle Act in India.Image credit source: Pixabay
In India, under the Motor Vehicle Act, it is mandatory to insure any type of vehicle, whether it is a car, a motorcycle or a scooter. Car insurance premium is very high, in such a situation, if you also want to reduce your car insurance premium by 50 percent, then this method can work for you.
The ‘No Claim Bonus’ proves to be very helpful in reducing the premium of car insurance. If a policy holder does not claim any kind of damage or loss during the car insurance policy term, then the policy holder gets the benefit in the form of a discount in the premium.
Whenever a policy holder renews his car insurance policy. Then the company offers him a discount of 20 to 50 percent on the premium due to the no claim bonus. In this way, the car insurance premium of the people is reduced by up to 50 percent.
The benefit of no claim bonus increases year by year. How many times have you availed no claim bonus with your car insurance? This determines the discount on your premium. The more times you avail the ‘No Claim Bonus’ with your car insurance, the higher the exemption limit on your premium.
One more thing that matters with ‘No Claim Bonus’. That is, its benefit is actually linked to the policy holder and not to the vehicle for which you have taken the insurance. If you have availed no claim bonus multiple times on one of your cars, then you can take advantage of it on the insurance of your other cars as well.
Regarding the policy holders taking ‘no claim bonus’, insurance companies believe that such people drive safely, so accidents are less and claims are reduced. Companies also give ‘no claim bonus’ so that safe drive can be promoted among the people.