What is a No Claims Discount and how does it work?

A No-Claim Discount (NCD) is an entitlement given to you if no claim has been made under your policy for a year or more with the current/existing insurer. It reduces the premium you have to pay for the following year. This is your insurer's way of recognising and rewarding you for having been a careful driver. There is a standard followed by all insurers in setting the NCD, depending on your type of vehicle (private or commercial/motorcycle) and the period of insurance with no claim.

The following table shows how the NCD is set by all insurers across the industry.

Private Car Policies Period of insurance with no claim Discount on renewal
1 year 10%
2 years 20%
3 years 30%
4 years 40%
5 years or longer 50%
Commercial Vehicle & Motorcycle Policies 1 year 10%
2 years 15%
3 years or longer 20%


NCD is just one of the factors affecting the premium. Premium quoted by an insurer based on a higher NCD would not necessarily be lower than that quoted by another insurer based on a lower NCD in a competitive market. Consumers are advised to shop around and compare premium rates before buying.


If I make a claim, will I automatically lose my NCD?

Not necessarily. Your NCD may not be affected if you are found totally not at fault in an accident involving another vehicle. In all other cases, your NCD may be affected.

If there is a claim made under the policy, your NCD will be reduced as follows.

Private Car Policies Current NCD NCD after 1 claim
50% 20%
40% 10%
30% and under 0%
Commercial Vehicle & Motorcycle Policies 20% / 15% / 10% 0%

If you make more than one claim in a year, your NCD will be reduced to 0%.

Please check with your insurer whether your NCD will be affected.

Some insurers do offer a protection on your NCD in the event of a claim. Please refer to question “Can I insure against the loss of my NCD?” to find out more.



Is my NCD transferrable?

In principle, your NCD applies to you and not to your vehicle. For example, if you sell your vehicle and buy another one, you will retain your NCD. However, if you own more than one vehicle, you might have a different NCD for each vehicle. You should check the details with your insurer, but generally:

Your NCD can-

  • Be transferred if you decide to switch insurer.
  • Be transferred to another vehicle you own, but it cannot be applied to more than one vehicle at any point in time. For example, if you have accumulated a 30% NCD while using one vehicle, it does not follow that the same NCD applies to any other vehicle that you own or decide to buy. In other words, you will have to earn the NCD for each vehicle separately.

Your NCD cannot -

Be transferred to another person, except for your spouse and within the current insurer only. Transfer of NCD to your spouse will not be applicable if you renew your policy with another insurer.



Will I lose my NCD if there is a break in ownership of my vehicle?

Most insurers in Singapore will allow you to keep your NCD should there be a break in vehicle ownership for up to 24 months. Some insurers set the timeframe at 12 months. You should contact your insurer for details.



Can I insure against the loss of my NCD?

If you have accumulated a certain level of NCD, for example 50% NCD (five years or longer without a claim), some insurers may allow you to buy protection against the loss of the discount.

By paying a small amount of extra premium, you can make one claim within the period of insurance, and still have the NCD fully protected. The protected NCD is as follows:

Claims made during the period of insurance Protected NCD Entitlement upon renewal with same insurer (Private Car Only) NCD Entitlement upon renewal with new insurer (Private Car Only)
  • One
  • Two
  • Three or more
  • 50%
  • 20%
  • Nil
  • 20%
  • Nil
  • Nil

Unlike NCD, the protected NCD may not necessarily be transferable to another insurer. Having an NCD Protector will also not protect you against non-renewal or cancellation of your policy by your insurer.

The features of a NCD Protector may differ from insurer to insurer. Always check carefully and understand how the NCD protection cover works before purchasing the protection.

Please check with your insurer whether NCD protection cover is available.



How can safe driving save me even more money?

If you have not violated any traffic rules for three consecutive years, you are entitled to a Certificate of Merit from the Singapore Traffic Police.

Should your NCD be 30% and above for a private car policy or 20% for a privately owned commercial vehicle policy, some insurers may reward you with a further 5% discount upon presentation of your Certificate of Merit.