How Much Extra Coverage Can You Get With No-Claim Bonus?

The No-Claim Bonus in health insurance refers to a reward that an insured person gets for maintaining better health and not filing any claim during a policy year.

No-claim bonus in health insurance is the bonus amount added to your sum insured for each claim-free year. This discount accumulates over consecutive no-claim periods, capped at 50%. This increases the sum insured or reduces the premium. No claim bonuses are applicable in health insurance when you do not make any claim in a policy year.

A no-claim bonus, also known as NCB, is a benefit that insured persons are entitled to enjoy for not filing any health insurance claims. It allows policyholders to receive premium discounts or additional health insurance coverage, in addition to their base sum insured. It is a way for insurance providers to appreciate and reward policyholders for maintaining a healthy lifestyle and taking preventive measures in their daily routines.

Keep in mind that the specifics of the No Claim Bonus can vary by insurer and by policies, so it is essential to review the terms and conditions of particular health insurance plans.

How Does No-Claim Bonus Work in Health Insurance?

The NCB in health insurance is an appreciation or reward provided by your insurer to the policyholder for each year they remain claim-free. Let’s understand how it works in health insurance through an example:

Mr Arora has a health insurance plan with a sum insured of Rs. 5 lakhs. Assuming his policy offers a No-Claim Bonus of 10% per claim-free year, subject to a maximum of 35%, the year-wise sum insured, claim-free bonus, and coverage limit will be as shown in the table below (on the assumption there is no change in the Sum Insured year-on-year):

Please note that the formula for the calculation of No-Claim Bonus and the rules for the utilisation of the same vary from policy to policy.