What Is No Claim Bonus In Health Insurance?

6 mins read
by Angel One
Explore the benefits of no claim bonus in health insurance, offering cost savings and flexibility. Learn key considerations like coverage amounts and waiting periods for informed policy decisions.

Health insurance is like a safety net for both your well-being and your family’s financial stability. It comes with several benefits, such as covering medical expenses, providing cashless treatment options, wellness rewards, regular health check-ups, and virtual medical consultations. Beyond these usual perks, if you maintain your policy without any breaks, there’s an extra advantage called the no claim bonus in health insurance.

In this article, we’ll break down what no claim bonus in health insurance means, explore its features and benefits, and discuss what to consider when selecting an NCB health insurance.

What Is No Claim Bonus In Health Insurance? 

No claim bonus in health insurance is a special reward granted by insurance providers to policyholders who refrain from making any claims during a specific policy period. This bonus, expressed as a percentage, is a unique way for insurance companies to appreciate clients who maintain good health and avoid seeking medical reimbursements. When this bonus on no claim in health insurance is added to the sum insured, it leads to an augmented coverage amount, providing extra financial protection. Essentially, the longer a policyholder goes without filing any claims, the higher the no-claim percentage they accumulate, resulting in potential savings on future premiums.

Types of NCB Health Insurance 

Insurance companies offer health insurance no claim bonus benefits through two primary categories:

  • Increased Coverage Reward

This bonus on no claim in health insurance type boosts your coverage for each claim-free year, maintaining a steady premium. For example, imagine Ms Sharma’s 15 lakh health insurance policy and a 7% No-Claim Bonus for each consecutive claim-free year. After three years without claims, her coverage rises progressively from 15 lakh to 17.15 lakh. This means that Ms Sharma can claim up to 17,15,000 in the fourth year without additional premiums, offering a valuable incentive for maintaining a healthy lifestyle.

  • Premium Reduction Reward

In this no claim bonus in health insurance scenario, policyholders enjoy lower premiums for each claim-free year while keeping the same coverage. For instance, Mr Patel’s health insurance policy of 12 lakh, with an annual premium of Rs. 20,000, offers a 12% discount on premiums for each consecutive claim-free year. If Mr Patel refrains from making claims in the first year, he would only need to pay 17,600 during renewal. This No-Claim Bonus promotes a health-conscious lifestyle and provides a tangible financial benefit by reducing the annual premium, encouraging policyholders to prioritise preventive healthcare measures and overall well-being.

Read More About Types of Health Insurance

How Does Health Insurance No Claim Bonus Work? 

Here is how no claim bonus in health insurance works, unfolding through several key steps in the insurance process:

1. Policy Renewal Evaluation

During the annual policy renewal, insurers conduct a comprehensive review, emphasising the claims history to ensure accurate policyholder records. This meticulous assessment forms the basis for subsequent evaluations and NCB health insurance calculations.

2. Recognition of Claim-Free Year

Acknowledging a claim-free year is integral to health insurance no claim bonus. Suppose the policyholder refrains from initiating claims throughout the policy duration. That year becomes a cornerstone for unlocking the associated benefits, highlighting the importance of maintaining a claims-free track record.

3. No-Claim Bonus Calculation

Calculating a bonus on no claim in health insurance relies on consecutive claim-free years. While varying among insurance companies and plans, this percentage-based calculation incentivises policyholders to prioritise preventive healthcare, contributing to overall coverage enhancement.

4. Premium Discount Application

Applying the no claim bonus in health insurance involves incorporating an additional sum into the Sum Insured. For example, with a 20% NCB, a policyholder’s ₹20,000 Sum Insured increases to ₹24,000, with the original premium remaining at ₹20,000. This demonstrates the financial benefits of maintaining a claims-free status.

5. Bonus Transferability

The accumulated NCB health insurance transferability becomes valuable in switching insurance provider scenarios. Policyholders can seamlessly carry their bonus to the new insurer, preserving accrued benefits and encouraging policy continuity despite provider changes.

6. Loss of Bonus with Claims

While health insurance no claim bonus provides tangible benefits, making a claim results in losing these benefits for that specific year. This underscores the importance of careful consideration before initiating claims, as it directly impacts the additional advantages accrued through the No-Claim Bonus.

What Are The Benefits Of No Claim Bonus In Health Insurance?

Now, let’s explore the benefits of the no claim bonus in health insurance and see how it can benefit policyholders:

  • Cost Saving

The health insurance no claim bonus serves as a valuable cost-saving incentive. This reward, offered by insurance providers to policyholders abstaining from claims throughout the policy year, translates into financial savings. Often presented as an additional amount on the Sum Insured, this benefit aligns financial prudence with health-conscious choices.

  • Flexibility

Policyholders enjoy enhanced flexibility with a bonus on no claim in health insurance. Some insurers permit customers to leverage this bonus for deductibles and other incentives, facilitating policy upgrades. This flexibility empowers individuals to optimise their coverage, ensuring their insurance plan adapts to evolving needs and preferences.

  • Long-Term Savings

Consistent maintenance of consecutive claim-free years amplifies the NCB health insurance, fostering substantial long-term savings. The gradual increase in premium discounts becomes a powerful motivator for policyholders to prioritise a healthy lifestyle, contributing to physical well-being and financial resilience.

  • Incentive for Good Health

Positioned as a reward for maintaining good health, the health insurance no claim bonus in health insurance is a positive incentive. Insurers promote healthier lifestyles by encouraging policyholders to manage their well-being and remain in good physical condition.

  • Enhanced Coverage

Beyond the financial benefits, health insurance companies enhance the coverage of policies through the health insurance no claim bonus. This includes additional perks and customer loyalty benefits, providing added value to policyholders. These enhancements contribute to a comprehensive and rewarding insurance experience.

What To Consider When Choosing NCB Health Insurance?

When choosing NCB Health Insurance, it’s essential to consider various factors despite the attractiveness of the No Claim Bonus. Here are some key considerations:

1. Coverage Amount

Ensure that the policy provides sufficient coverage for your medical needs. The No Claim Bonus should complement a comprehensive coverage plan tailored to your health requirements.

2. Waiting Period

Be aware of the waiting period associated with the NCB benefit. Some policies may have a waiting period before you can avail of the No Claim Bonus. Clarify this aspect to make informed decisions.

3. Premium

Compare the premiums of different NCB policies and choose the one that provides the best value for money. Balancing the cost with the benefits ensures a cost-effective and beneficial insurance plan.

4. Claim Process

Assess the ease of use and effectiveness of the claim procedure. A policy with a complicated or time-consuming claim process may outweigh the benefits of the No Claim Bonus. Opt for a policy with a straightforward and user-friendly claims procedure to ensure a hassle-free experience.

Read More About How to Choose Health Insurance?


In conclusion, the no claim bonus in health insurance presents alluring advantages, including potential cost savings, flexibility, and long-term financial benefits. When considering insurance options, it’s pivotal to weigh factors like coverage amounts, waiting periods, premiums, and the ease of the claim process. Striking a harmonious balance ensures that the selected policy optimizes the benefits of the no-claim bonus while delivering comprehensive and customized coverage.


What is a no claim bonus in health insurance?

A no claim bonus in health insurance is a reward providers offer to policyholders who refrain from making claims during a policy year. It often translates into cost savings and increased coverage.

How is no claim bonus calculated in health insurance?

The calculation of the no claim bonus is percentage-based and varies among companies. It typically increases for every consecutive claim-free year, encouraging policyholders to maintain good health and minimise claims.

Can I transfer my no claim bonus to a new insurance provider?

Many insurance providers allow the transfer of accumulated no-claim bonus when switching policies. This ensures continuity of benefits even with a change in insurers.

What factors should I consider when choosing NCB health insurance?

When selecting NCB health insurance, consider coverage amounts, waiting periods, premiums, and the simplicity of the claim process. Striking a balance ensures a policy that maximises the benefits of the no claim bonus.

Does making a claim impact the no claim bonus benefits?

Yes, making a claim during the policy term results in the loss of benefits the No Claim Bonus provides for that specific year. Policyholders should weigh the potential benefits against the impact on the bonus before initiating claims.