Does Health Insurance Offer No Claim Bonus?
Written by Upstox Desk
4 min read | Updated on May 29, 2025, 15:36 IST
What Is No Claim Bonus in Health Insurance?
No Claim Bonus features in health insurance
How does NCB work in real life?
Conditions and Limitations of NCB
Which Insurers Offer NCB and in what Capacity?
Conclusion: Treat it as a bonus, not a gamble
FAQ
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Riya is a 30-year-old professional and bought a health insurance policy with a ₹5 lakh sum insured. Riya was a fit individual and did not incur any claims in five consecutive years. Because of the NCB feature, Riya’s sum insured was increased by 20% each year, and eventually, she had a 10 lakh sum insured without paying any more premiums. When the time came in the sixth year, when Riya had a sudden medical emergency, the increase in sum insured was life-saving and paid off for her when she made the smart decision to stay insured and remain healthy.
Imagine your health insurance company rewarded you with additional coverage, free of charge, because you didn’t take any time off due to illness. Health insurers do this when giving you a No-Claim Bonus (NCB). Most people think of NCB as a feature of motor vehicle insurance. Still, health insurers have adopted this to reward you with free coverage for not filing a claim during the policy year, because you were healthy. They say, “Good job staying healthy, here's more free coverage!”
Let us explore how NCB works in health insurance, its different types, benefits, limitations, and how you can make the most of it.
What Is No Claim Bonus in Health Insurance?
In health insurance, insurers provide a no-claim bonus (NCB) to policyholders who don't turn in a claim during a policy year. This bonus is an incentive to stay healthy and not use coverage unnecessarily.
Typically, health insurers provide the bonus in two ways:
Cumulative Bonus
The sum insured would rise by a particular percentage with no rise in premium.
Premium Discount
A small discount on renewal premiums (less common in health insurance than general insurance).
NCB can be earned in individual or family floater plans, a good perk for all policyholders.
No Claim Bonus features in health insurance
Let's discuss the various types of No Claim Bonus available in health insurance.
Cumulative Bonus
This type is often used in health insurance, where the sum insured increases by a percentage, typically 5% to 50%, for each claim-free year. For example, with a sum insured of 5 lakhs and a 20% cumulative bonus, your cover rises to 6 lakhs the next year.
Renewal Premium Discount
Sometimes, health insurers offer a small discount on your renewal premium if you haven't claimed in previous years. While less exciting than a sum increase, it provides a discount on the next year's renewal.
Super No Claim Bonus (Enhanced NCB)
Recent health plans, especially digital-first plans, offer aggressive bonuses, such as 50% extra coverage for the year, up to a maximum of 200%.
How does NCB work in real life?
No Claim Bonus (NCB) in health insurance increases your sum insured yearly without raising your premium, as long as you don't make a claim. This bonus boosts your financial coverage and rewards you for maintaining a claim-free record. Typically, the increase is a fixed percentage, capped by the insurer.
Base Sum Insured: ₹5 lakhs NCB rate: 20% per annum (up to 100%)
Scenario Over 5 Years:
- Year 1 (Claim Free): ₹6 lakhs
- Year 2 (Claim Free): ₹7 lakhs
- Year 3 (Claim Free): ₹8 lakhs
- Year 4 (Claim Free): ₹9 lakhs
- Year 5 (Claim Free): ₹10 lakhs
You have doubled your insurance coverage in five years without increasing an ounce. NCB is a great incentive to stay healthy and not make a claim.
Conditions and Limitations of NCB
Despite being a fantastic advantage, NCB comes with some important conditions and limitations:
Forfeiture on Claim
If a claim is made, the bonus is usually forfeited or reduced unless you have an NCB protector add-on.
Non-Transferable Without Porting
You cannot transfer your NCB between insurers unless you port your policy with continuity
Cap
NCB is capped, typically at 100% to 200% of your base Sums Insured
Add-ons Available
Some insurers offer NCB Protect, which means you can keep your bonus if the claim is small. This would give you peace of mind if you were concerned about emergencies.
Which Insurers Offer NCB and in what Capacity?
Here's a quick overview of how major insurers are dealing with NCB across India:
Niva Bupa
Niva Bupa offers a Super NCB feature, allowing for a 20% increase for each claim-free year, up to 200% of the base sum insured.
HDFC Ergo
They offer an NCB Protect add-on that allows you to retain the bonus up to 200 % of your sum insured after small claims.
Each insurer can have dramatically different terms, so review the policy document or speak with your advisor before purchasing.
Conclusion: Treat it as a bonus, not a gamble
A No Claim Bonus (NCB) in health insurance rewards you for good health. NCB can increase your cover without raising premiums, providing a financial buffer over time.
Don’t let NCB prevent necessary treatment; always prioritize your health. Use NCB as a bonus, not a gamble, to balance health with financial planning.
FAQ
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Is NCB applicable in all health insurance policies?
NCB does not apply to all policies – always check your policy brochure or terms before buying.
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Can I transfer NCB to another insurer?
Yes, but only if you port your policy while continuing your coverage.
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If I make a small claim, what happens to my NCB?
Usually, your NCB will revert or be lost unless it's part of your plan that allows NCB Protect.
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Is there a limit to how much NCB I can get?
Yes. Most policies limit your NCB to 100% and 200% of your insured base sum.
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Should I avoid making a claim just to keep my NCB?
No. Your health is more important. Use your policy as needed – that’s why you have a health policy.
About Author
Upstox Desk
Upstox Desk
Team of expert writers dedicated to providing insightful and comprehensive coverage on stock markets, economic trends, commodities, business developments, and personal finance. With a passion for delivering valuable information, the team strives to keep readers informed about the latest trends and developments in the financial world.
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