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How to Use No-Claims Bonus and save the premium

How to Use No-Claims Bonus and save the premium

Snapshot: You can use the NCB that you have earned to save a large amount of money on the insurance of your new car.

People try to negotiate on different costs associated with a new vehicle but rarely do they think about saving money in insurance costs. You can use the no claim bonus that you have earned on your old car to save a large amount of money on the insurance of your new car. The advantages could be huge. The percentage of savings you get on your old car would translate into a bigger amount on your new car. And the strangest thing here is that your insurance agent won’t bother telling you about this because they earn as a percentage of the premium and thus their earnings would be affected. We tell you how you can save on your insurance costs using some neat little tips.

Get the NCB certificate

When you sell your old car, make sure you get a copy of the delivery note and forward a copy to the insurance company. This letter will be valid for the next three years and you can use it to save money on the insurance of your new vehicle. You might have to visit the insurance company’s local office for this letter.

Use it on your new policy

The no claim bonus certificate that you have obtained will help you save on insurance costs. All you have to do is provide this letter to the car dealer and they will arrange for the benefits on your new policy. At times the manufacturer’s insurance schemes are cheaper as compared to the usual mainstream ones.

Continuing the old provider

Just in case you continuing with your current insurance company and happy with their service, you can continue with it rather than switching to a new one for the new vehicle. For that, get the chassis number and car invoice of your new vehicle from the dealer and take this information to your insurance company. They will offer you a reduced premium cover note taking in account your No Claim Bonus. You can then take this cover note to register your car to the car dealer.

On a different note, getting an insurance policy with zero depreciation would be really advisable if you are getting a premium vehicle. This is because on standard insurance policies, you would have to bear a fraction of the costs and even that would be a huge amount. Not to mention the costs incurred when your car is with the service center. With a zero depreciation car insurance policy, the company would bear almost all the expenses and also provide you with expenses to make up for the absence of your car.

Getting benefits without selling the old car

You can also get the No Claim Bonus advantage without selling the old car before taking the delivery of the new one. You can take the delivery of your new vehicle with the usual insurance rates. Then after you sell off the old vehicle, you can start taking the no claim bonus advantage on your new car. If you are planning to keep your old car, you can cancel the policy on your old vehicle to obtain the no claim bonus certificate and use it to get the advantage on new car. Another option would be to transfer the old vehicle’s ownership to a family member so that you can get the advantage on your new purchase.

Preserving the no claim bonus

There are times when you have to choose between the no claim bonus advantage and your damage that you are willing to claim. If the expense is not huge and lower than what you are saving on the insurance premium, it would be advisable to pay for your repairs and continue getting the no claim bonus advantage. If you make a claim for a minor expense, you will end up losing the benefits for the years to come. Not only that but you will also lose the advantage you will get while buying a new car. The net impact would be much more than the expense in such a case.

Also Read: How to Buy Car Insurance For Used Cars?

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