A No-Claim Discount (‘NCD’) is an incentive given to you if no claim has been made under your policy for a year or more with your 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. The rate of NCD depends on your type of vehicle (private or commercial/motorcycle) and the period of insurance with no claim.
The following table shows a common method to calculate the rate of NCD.
| Private Car Policies | Period of insurance with no claim | Discount on renewal |
| 1 year | 10% | |
| 2 year | 20% | |
| 3 year | 30% | |
| 4 year | 40% | |
| 5 years or longer | 50% | |
| Commercial Vehicle & Motorcycle Policies | 1 year | 10% |
| 2 year | 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.