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Know More about Cumulative or No-Claim Bonus and Its Essentials!


Feb 19 2020


Insurance-related terms can intimidate you if you are not aware of technicalities. This is where it is equally important to understand it completely, to enjoy the maximum benefits. It is often asked what a cumulative bonus in health insurance is. Let’s have a look at the similar questions that you already have in your mind.  

Cumulative bonus in health insurance is one of the most critical and beneficial features that every policyholder must know to enjoy a level of benefits that it brings in. 

What is a cumulative bonus in health insurance?

A cumulative bonus in health insurance is a benefit that the insurer offers to you, in case you do not claim any cover in the current year. This means that every claim-free year earns you a benefit which can be in any form, related to the policy. 

The health insurance provider companies either offer an increase in the sum insured or a discount on the premium payable or a combination of both options as a cumulative or no-claim bonus in health insurance.

Most of the insurers pay cumulative bonuses like a 5% increase in the cover. However, if you have a claim-free third year, you can expect another 5% increase in the base of the sum insured.

The insurer may also offer a discount on the premium amount, which means you have to pay a lesser premium for the same cover.

Maximum Cumulative Bonus Offered:

There are no fixed or year-wise slabs for the cumulative bonus. However, in general, the maximum cumulative bonus in health insurance given be as high as 150% of the sum insured.

Does Any Claim Effect Cumulative Bonus?

In case you avail a claim in any of the years, you might have to bear a considerable impact, depending on the plan you choose. The insurer terminates the cumulative bonus benefit and the sum insured comes down to the original amount. In case of bonuses offered as a cumulative bonus, you may have to pay the initial premium only. These rules differ from insurer to insurer and might be lenient as well. Nowadays, there are plans, like ManipalCIgna’s ProHealth, where the bonus is guaranteed, even if you make a claim. 

In Case of Availing the Portability Feature-

In case you have accumulated a bonus in your existing policy, and wish to switch to some other health insurance provider, the accrued bonus gets transferred as well. However, the transfer depends on the type of bonus the new company offers. These conditions include age limit for the transfer, bonus amount transfer limitation and much more.

Essential facts to know about the cumulative bonus in health insurance in India:

  • In most of the cases, insurer offer cumulative bonus in the range of 5-10%
  • It is a transferrable feature which can be ported to another health insurance provider.
  • In case of non-payment of premium and expiration because of the same, the accumulated cumulative bonus also expires.
  • If you have accumulated cumulative bonus in policy and are making multiple claims later, the cumulative bonus, as well as the available sum insured, is taken into account.

Hope this makes you understand what is a cumulative bonus in health insurance?