What is No Claim Bonus in Health Insurance and How Does It Work?

Have you ever gone a whole year without falling sick or visiting a hospital? If yes—and if you had a health insurance policy during that time—you might’ve earned something called a No claim bonus in health insurance. But what exactly is it?

Let’s break it down in simple terms so you know how it works, why it matters, and how you can benefit from it in the long run.

First, What is a No Claim Bonus in Health Insurance?

A no claim bonus in health insurance is a reward that your insurance provider gives you for not making any claims during your policy year. It's like getting a pat on the back for staying healthy!

Instead of giving you money directly, this bonus usually comes in two ways:

1. Extra health coverage at no extra cost

2. Discount on your premium during renewal

Here’s a Simple Example

Let’s say you buy a health insurance plan with ₹5 lakh coverage.

• Year 1: No claims made → You get 10% bonus → New coverage is ₹5.5 lakhs

• Year 2: Still no claims → Another 10% bonus → New coverage is ₹6 lakhs

• Year 3: You make a claim → Bonus resets → Back to ₹5 lakhs

This is how the no claim bonus in health insurance builds up year by year. Most policies cap the bonus at 50% to 100% of your base coverage.

So in a few healthy years, your ₹5 lakh policy could turn into ₹7–10 lakh worth of coverage—without paying more.

Why Does No Claim Bonus Matter?

It Rewards Healthy Living

The no claim bonus in health insurance encourages you to stay fit. The longer you go without raising a claim, the more you benefit.

It Increases Your Coverage

With each claim-free year, your coverage grows. This helps cover rising medical costs without paying extra.

It Saves You Money

In some cases, no claim bonus is given as a discount on your renewal premium. Either way, you're saving—whether through better coverage or lower costs.

Different Types of No Claim Bonus in Health Insurance

Not all policies offer the same bonus structure. Here are the main types:

1. Cumulative Bonus

Your coverage increases by a fixed percentage each year you don’t file a claim. It’s the most common form of no claim bonus in health insurance.

2. Premium Discount

Instead of raising the sum insured, some policies reduce the renewal premium if no claims are made.

3. NCB Protect Add-On

Some policies offer this add-on to protect your earned no claim bonus, even if you make a small claim. It’s optional but useful.

What If You Do Make a Claim?

If you do raise a claim during the year, your no claim bonus in health insurance may reset or reduce. The exact change depends on your policy’s terms.

That said, you can start earning the bonus again in the following claim-free years. Some policies are more flexible and allow partial retention of your NCB.

Smart Tips to Make the Most of NCB

Here are some practical ways to take full advantage of the no claim bonus in health insurance:

1. Avoid Small Claims

If you can manage minor medical bills on your own, consider not filing a claim. This keeps your no claim bonus intact for bigger emergencies.

2. Use Free Health Checkups

Many policies offer annual checkups. Use them to stay on top of your health and avoid larger health issues that might lead to claims.

3. Understand Policy Terms

Know how your no claim bonus in health insurance is calculated. Some policies increase the sum insured by 10% annually, others go higher.

4. Compare Before You Buy

When shopping for health insurance, look for plans that offer a generous and flexible no claim bonus. Some allow accumulation up to double your original coverage.

How Does No Claim Bonus Work in Family Plans?

If you’re on a family floater plan, the no claim bonus in health insurance works slightly differently. Since the coverage is shared, a claim by any one member can affect the bonus for all.

Still, if your family remains claim-free, the entire policy can benefit from increased coverage through NCB.

Can You Transfer Your No Claim Bonus?

Yes! If you decide to switch health insurance providers, you can take your accumulated no claim bonus with you—just make sure the new policy is purchased within the required time frame and meets portability conditions.

This way, you don’t lose out on your earned benefits when you move to a better plan.

Final Thoughts

The no claim bonus in health insurance is a powerful feature that rewards good health and smart policy usage. Over time, it can increase your protection, reduce your premium, and give you peace of mind.

Here’s a quick summary:

• The longer you go without making a claim, the more bonus you get.

• It either increases your sum insured or lowers your premium.

• You can protect it using add-ons and carry it forward when switching plans.

• It works for both individual and family floater plans.

So when you buy or renew your health insurance, don’t overlook the no claim bonus. It’s one of the few benefits that literally pays you for staying well.

If you’re exploring new health insurance options, always ask:“What kind of no claim bonus does this policy offer?”It could be the key to stronger, smarter protection for you and your family.