No Claim Bonus (NCB) in Health Insurance

No Claim Bonus (NCB) in health insurance is a reward for not making claims during a policy year, and when used strategically, it can significantly increase your effective coverage over time. In health insurance, NCB typically works by increasing your sum insured for each claim-free year, either as a cumulative bonus or a multiplier. The most common structure is a 10-50% increase in sum insured for each claim-free year, up to a maximum cap, typically 50-100% of the base sum insured.

For example, if you start with a Rs 5 lakh policy and the NCB is 10% per claim-free year up to 50%, after 5 claim-free years your effective sum insured becomes Rs 7.5 lakh without any premium increase for the additional coverage. Some plans like HDFC ERGO Optima Secure offer a cumulative bonus structure that can double your sum insured over time. When you make a claim, NCB is typically reduced or reset depending on the plan terms — some plans reduce NCB to zero, others reduce it proportionally.

NCB protection riders are available in some plans that allow one claim per year without losing your accumulated bonus. Under IRDAI portability guidelines, your accumulated NCB is portable when you switch insurers, preserving the benefit you have built over years of claim-free behaviour. NCB in health insurance differs from motor insurance NCB: in health it increases sum insured, while in motor it reduces premium.

When comparing plans, pay attention to the NCB rate, the maximum bonus achievable, the impact of a claim on your NCB, and whether NCB protection is available as an option.