Mint classroom: How to avail no-claim bonus when buying a car1 min read . Updated: 01 Nov 2016, 04:08 PM IST
If you have not claimed any insurance on your old car for more than a year, you are entitled to a discount on the own-damage part of your insurance policy
Are you planning to replace your old car? If you have not claimed any insurance on your old car for more than a year, you are entitled to a discount on the own-damage part of your insurance policy. This discount is called no-claim bonus. For each year that passes without a claim, this discount goes up by 10%, up to a maximum of 50%. You can also avail this discount if you are changing your insurer and not your car, and vice-versa. Mint explains how you can reduce your insurance, even when you buy a new car.
When you change your car, you typically get a new insurance cover for it. You can save money by transferring the cover of your older vehicle to the new one. Once you have transferred the ownership of the vehicle, take your buyer-seller agreement, along with an application for the transfer of no-claim bonus, to the insurance company’s office. This is applicable to all policies, bought online as well as offline.
Once the insurer verifies the buyer-seller agreement and checks that you have not claimed insurance in the past one or more years (on your older vehicle), you will get a no-claim bonus certificate. This certificate is valid for a period of 3 years. This means that even if you do not plan to buy a new car immediately after selling your older car, you can still get no-claim bonus when you buy a new car in the near future.
While buying insurance for your new car, produce the no-claim bonus certificate from the previous insurer. Depending on the number of no-claim years, you can get a discount of up to 50% on the own-damage part of the cover. This bonus is a percent of the premium. So, if you were entitled to 50% no-claim bonus on a small car, you will get 50% off even if you buy a bigger car, which has a much higher premium.