Health insurance is a crucial security option or a financial help that provides financial protection when you or your loved ones fall ill. However, insurance premiums are a huge responsibility and financial burden, and many individuals are constantly on the lookout for ways to reduce these costs. One such cost-saving mechanism in health insurance is the No-Claim Bonus (NCB).
When we talk about health insurance, we are basically talking about all the benefits it offers to us as policyholders. There are numerous benefits a health insurance policy provides you with, including the sum assured, claims, hospital facilities, cashless insurance, etc. One of these benefits is the no-claim bonus!
No-claim bonus is one of the lesser-known features of a health policy, but it is very valuable and helpful. You receive a no-claim bonus on many types of policies, like comprehensive health insurance, senior citizen health insurance, four-wheeler insurance, etc.
You must understand the concept properly because it will help you gain the benefits and make better life decisions for the same.
In this blog, we will discuss this no-claim bonus in detail.
No-Claim Bonus (NCB) in Health Insurance
The insurance company offers the policyholder a reward in return for not raising a claim in the policy tenure. It rewards you for staying healthy! There are a few more benefits that come along with NCB in medical insurance.
It serves as an incentive for policyholders to adopt a healthier lifestyle and utilise their health insurance coverage only when necessary. We will learn about them further in the blog.
Types of No-Claim Bonuses
Cumulative Bonus
If the policyholder does not claim the policy tenure and the sum assured is increased as a result of this, while the premium of the insurance plan remains the same, it is called the cumulative bonus.
Discount-Offering Bonus
Suppose the policyholder does not claim the policy tenure, and the policy premium is reduced at the time of renewal. In that case, it is a no-claim bonus that offers you a discount on the premium at the time of renewal.
Retained Bonus
If the policyholder wants to switch insurance providers but has earned a no-claim bonus by not raising a claim for their health insurance, they can switch companies. The NCB is also carried forward to the next company. The IRDAI has made it mandatory to allow policyholders some grace period to move their no-claim bonus to the new insurance company.
Benefits of No-Claim Bonus
- With the no-claim bonus, you can significantly reduce the amount of premiums you pay. The primary benefit is the premium savings due to the discount feature that comes along with NCB.
- We are being rewarded for being healthy and maintaining that health for a long time. This is like an incentive for a healthy way of living.
- The ability to retain your No-claim bonus and transfer it to the next policy provider is a huge plus. It is a benefit because you don’t want to lose all the incentive you received for being sincere and rightful to your health.
- You receive extra or enhanced coverage with the no-claim bonus. This is a benefit because you don’t have to pay any more than you already do, and yet you receive a bigger sum assured as well as coverage.
Conclusion
No-Claim Bonus in health insurance is a valuable feature that rewards policyholders for maintaining good health and avoiding claims. It provides a win-win scenario where policyholders benefit from reduced premiums, encouragement to focus on preventive care, and financial security during emergencies, while insurers benefit from fewer claims.
The cumulative nature of NCB also offers long-term financial advantages to policyholders who consistently maintain good health.
When you buy health insurance online, having a policy with a No-Claim Bonus can be a prudent financial move. It not only safeguards your financial well-being but also motivates you to lead a healthier life. So, the next time you consider your health insurance options, make sure to inquire about the No-Claim Bonus and how it can benefit you in the long run. Remember, a healthy lifestyle pays off not only in terms of well-being but also in reduced insurance premiums.
