NISM Certifications · NISM-Series-X-B: Investment Adviser (Level 2) · Non-Life Insurance Products
Ms. Kavita Rao, 34, buys a health policy with a sum insured of Rs 5 lakh. After she makes no claim in the first year, the insurer adds a 50% cumulative bonus to the sum insured at renewal without increasing the premium. Which feature is this?
This is a no claim bonus. The insurer rewards a claim-free year by increasing the sum insured, here by 50%, without charging extra premium. Co-payment, sub-limits and floater discounts do not work this way, as they involve cost sharing or caps.
- ACo-payment
- BNo claim bonusCorrect
- CSub-limit
- DFloater discount
Explanation
A no claim bonus rewards a claim-free year, typically through a higher sum insured at the same premium or a premium discount. Co-payment is a share of the claim borne by the insured. A sub-limit caps specific expenses. A floater discount relates to family cover.
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