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Health Insurance 9472 views December 12, 2019
Oriental Insurance Company Limited is a well-known health insurance company that caters to the needs of people from all segments. The products are well designed to meet the expenses incurred due to health hazards. They come with impressive cover amount at attractive premiums. A crucial feature of the health plan is No Claim Bonus. We will now study the concept of No Claim Bonus in detail.
Table of Contents
No Claim Bonus / No Claim Discount ( Loading):
No claim bonus (NCB) in health insurance is the additional benefit that gets added to the sum insured for each claim-free year. It can be considered as a return or reward that an insurer provides to the insured policyholder for no claims. Oriental Health Insurance Company provides the No Claim Bonus by giving a discount in premium and hence the benefit is named as No Claim Discount/ Loading or NCD.
Let us see how the No Claim Discount works.
No Claim Discount (NCD):
Part A
The company will provide a discount of 5% on the premium for each claim-free year, however, this is subject to a maximum of 20 %. This will be permissible if the insured renews the policy with the company without any gap. The company will forfeit the full No Claim Discount in case there is any claim made by the insured after the policy renewal. The No Claim Discount will continue to accumulate again from the following claim-free year.
Any claim which is acknowledged under the health insurance policy and wherever the No Claim Discount has not been accumulated or the earned No Claim Discount is lost, the company will add a loading and the same will be levied on the renewal premium @5% for each claim year, subject to a maximum of 20%. The No Claim Discount (NCD) / Loading on the premium will be as per below table:
| Standing of No Claim Discount /Loading in the expiring policy | No Claim Situation- the status of No Claim Discount /Loading while renewing a policy | Claim Made- the status of No Claim Discount/ Loading in while renewing the policy |
|---|---|---|
| 0% NCD / Loading | 5% NCD | 5% Loading |
| 5% NCD | 10%NCD | 0 % NCD / Loading |
| 10%NCD | 15% NCD | 0 % NCD / Loading |
| 15% NCD | 20% NCD | 0 % NCD / Loading |
| 20% NCD | 20% NCD | 0 % NCD / Loading |
| 5% Loading | 0% NCD / Loading | 10% Loading |
| 10% Loading | 5% NCD | 15% Loading |
| 15% Loading | 10%NCD | 20% Loading |
| 20% Loading | 15% NCD | 20% Loading |
Part B
No Claim Discount is also applicable to the plan which is specifically designed for senior citizens and is named as “Health of Privileged Elders”
The insured will be eligible for No Claim Discount at 5% of the premium at the time of renewal post each claim-free policy year, but the same is subject to a maximum of 20% without any break. The below table can be referred for the same:
| No Claim Discount Availability | Rate |
|---|---|
| Discount is available on renewal payable premium post one (or the first) claim free yearly policy | 5% |
| Discount is available on renewal payable premium on the second continuous claim free annual Policy | 10% |
| Discount is available on renewal payable premium on the third continuous claim free annual Policy | 15% |
| Discount is available on renewal payable premium on the fourth continuous claim free annual Policy | 20% |
Regardless of the claim amount, the no claim discount will be zero once the claim is paid or is zero under the policy.
Also, no advantage of any further insurance policy will be permissible at the time of renewal for the company to consider and giving the facility of No Claim Discount to the insured person.
The renewal together with the no claim discount is allowed by the company at its own discretion if the policy is renewed within 7 days from the date of expiry of the policy.
Summary
We can conclude from the above discussion that a No Claim Discount is a necessary feature that must be considered before buying any health insurance policy. However, it is advisable that one must read and understand the terms and conditions and various clauses clearly for him to apply for the appropriate health plan as per his need.