No Claim Bonus — Free Cover for Staying Healthy

No Claim Bonus is one of the few ways your health insurance actually gets better every year — if you do not make a claim.

How It Works

The Accumulation Mechanism

For every claim-free year, most policies increase your sum insured by 5-50% without additional premium. Over several claim-free years, your effective cover can be significantly higher than what you pay for. Modern policies like Booster+ carry forward unutilised sum insured.

Accumulation cap: Most policies cap NCB at 50-100% of base sum insured. Some newer products accumulate up to 5-10 times the base sum insured over many claim-free years.

What Happens When You Claim

NCB Reduction or Loss on Claiming

In most traditional policies, making a claim reduces your accumulated NCB — sometimes to zero. This creates a dilemma: should you claim for a Rs 30,000 hospitalisation and lose Rs 50,000 of accumulated NCB? Newer policies with Safeguard add-ons protect your NCB if the claim is below a threshold.

The calculation: Before claiming for a smaller amount, calculate the value of your accumulated NCB. If the NCB loss exceeds the claim amount, consider paying out of pocket to preserve the bonus.

Portability of NCB

Does Your Bonus Transfer When You Switch?

When you port to a new insurer, IRDAI requires the new insurer to give you credit for waiting periods served — but not necessarily for accumulated NCB. Some insurers honour ported NCB, others do not.

Ask before porting: Specifically ask the new insurer whether they will honour your accumulated NCB from your previous policy. Get the answer in writing before initiating the port.

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