Why You Should Retain the NCB Certificate When Selling Your Car

• Protect yourself with third party or comprehensive cover
• Use bumper to bumper policies to reduce your liability
• Enjoy facilities like zero depreciation and roadside assistance covers

Car insurance companies offer a No Claim Bonus (NCB) to policyholders who haven’t raised any claims during the policy year in an effort to reward the concerned individual for his/her safe driving. The No Claim Bonus is extremely beneficial since it can reduce the premium payable for the next year. Despite this, many vehicle owners don’t apply for the NCB certificate at the time of selling their car.  

If you are eligible to receive a No Claim Bonus and are looking to sell your car to a third party or an automobile dealership, it is necessary to get an NCB certificate from your current insurance company. With this certificate, once you purchase a new car and a car insurance policy for that vehicle, you will be able to secure a discount on the premium.

How to Apply for the NCB Certificate?

In order to get a No Claim Bonus certificate from your insurance provider, it is necessary to inform your motor insurance provider that you will be selling your current car. You will also need to submit a letter to the insurer requesting for the NCB certificate. You should make sure to mention the details of your current car insurance policy in the letter to help the insurer verify your request. You will also need to submit the following documents to the insurance company along with the request letter:

• A copy of the car insurance policy of the car that you will be selling
• A copy of the delivery note received for the sale of your car
• A copy of the booking form for the new car
• A copy of the registration certificate of the car
• Form 28 and Form 29

*Note: Any other documents that are required will have to be submitted.

After receiving your application and the relevant documents, the insurer will take a few days to issue the No Claim Bonus certificate. Post receiving the certificate, you can avail a discount on the premium when purchasing a policy for your new car. Based on the No Claim Bonus percentage that you have accrued, you can receive a substantial discount from the insurer.

Things to Keep in Mind

Certain things that you should keep in mind about the No Claim Bonus certificate are as follows:

• The No Claim Bonus is linked to the driver of the car and not the car itself. For this reason, it is necessary to apply for the NCB certificate if you are looking to sell your car or if you want to switch your car insurance company.
• The No Claim Bonus will only be given if you have a claim-free year. Also, you can accrue the No Claim Bonus. Thus, the bonus for a claim-free year starts at 20% and can go up to a maximum of 50%.
• As mentioned above, you will only receive the NCB if you don’t raise any claims during the policy year. Thus, it is recommended that you purchase the NCB Protect Cover from your insurance provider. Purchasing this add-on will keep your No Claim Bonus intact even if you do end up raising a claim during the policy year.
• You will only receive the No Claim Bonus if you have a car insurance policy with an own damage cover. Motor insurance companies will not offer you a No Claim Bonus if you only have a third-party liability insurance policy, regardless of whether you have raised claims during the policy year or not.
• The No Claim Bonus will be denied to you if you raise a claim during the policy year. Also, if you don’t renew your car insurance policy within 90 days of your policy expiring/lapsing, you will forfeit the accrued No Claim Bonus. Thus, it is necessary to ensure that you renew your car insurance policy on time, with no break in coverage.

In conclusion, it is necessary to always keep in mind that even the smallest of claims can result in the No Claim Bonus becoming nil, unless you have a No Claim Bonus Protect Cover. For this reason, it is recommended that you don’t raise claims for small damages. Since the cost of fixing small damages will be nominal, you should consider getting the damages fixed yourself in order to receive the No Claim Bonus from the insurer and save on premiums during the next policy year.

Although there are a number of formalities that will have to be taken care of when selling your car, it is necessary to remember to apply for the No Claim Bonus certificate, given how useful it can be in reducing your premium payable the following year.