A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
N. Na Nb Ne Nh Ni No Nr Nu

Nine-Months Rule

A contract signature rule adopted by the National Association of Insurance Commissioners generally imposing a nine-month time limit from the effective date of the treaty reinsurance agreement to the time when the treaty reinsurance contract must be actually executed by the ceding company and the reinsurer or, in the case of multiple reinsurers, the lead designated reinsurer. The rule enables the ceding company to comply with statutory and/or regulatory requirements and receive accounting treatment as prospective, as opposed to retroactive reinsurance.

Ninety-Day Rule

An account balance aging rule established by the National Association of Insurance Commissioners that provides that an insurer or reinsurer must age certain balances on Schedule F of the annual statement for reinsurance recoverables over ninety days past due for which the company may need to establish an uncollectible provision.

Nipple leakage

Leakage through the failure of the nipple joints of boiler or pressure plant. The cost of repair can be covered as an extension to a boiler and pressure plant policy. The extension covers ‘self damage’ only. Damage consequent upon the leakage is not covered as separate water damage cover is available under burst pipes cover. See ADDITIONAL PERILS.

No benefit to bailee

A clause in inland marine forms that prevents a person in the possession of property of others from benefiting from any insurance the owner has on the property.
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A provision in an Inland Marine insurance form which states that any insurance a person has on property in the possession of a bailee will not be for the benefit of the bailee. Example, if a suit is lost or destroyed at the cleaners, the cleaner cannot deny coverage on the basis that other insurance exists.

No claim bonus discount/bonus (NCD)

A reward for not claiming under a policy. For each motoring claim-free year it means a progressive reduction on the following year’s motor insurance premium until a four/five maximum year has been reached. Maximum discounts are in the range 60-65 per cent but if a claim occurs the insured drops back down the scale. Once the insured has four years’ NCD he can pay extra for a protected no claim bonus. The bonus is then guaranteed provided there are no more than two claims in any period of five years. NCDs are available from some household insurers

No Claim Bonus for Motor Insurance

Earned only on own damage section of the Package Policies covering all classes of vehicles except Motor Trade Policies, Road Transit Risks, Road Risks, Internal Risks. For policies covering liability including Fire and/or Theft risks the NCB will be applicable on the Fire and/or Theft premium only. An insured becomes entitled to NCB only at the time of renewal of the policy after the expiry of the full duration of twelve months provided insured has not made any claim during the last policy period of one year. The NCB can be accumulated up to a maximum limit of 50% on OD Premium. Discount on premium is uniform for all types of vehicles, ranges from minimum 20% to maximum 50% corresponding with 1 to 5 consecutive claim free years. The NCB follows the fortune of the original insured and not the vehicle or the policy. In case the customer is switching/changing to a company from any other insurance company and have accrued some NCB from previous insurer, he can get the same transferred in case the vehicle is insured within 90 days of renewal due date. In the event of the transfer, the new owner is not entitled to the NCB and hence the proportionate amount will be recovered if the new owner is not presently entitled to NCB or not enjoying NCB. NCB can be allowed on a substituted vehicle. However, the substituted vehicle must of the same class as the vehicle on which the NCB has been earned. In the case of an individual owner in the event of death of the individual where the custody of the vehicle passes to the spouse and/or children and/or parents or others the NCB entitlement can be transferred to the legal heir. If a vehicle is sold but not replaced immediately the NCB earned could be claimed within 3 years of cancellation of policy sold, for any fresh insurance. IN practice a few insurers are allowed lesser NCB than entitled on transfer or on substitute vehicle belonging to a different sub-class.

No Claim Bonus Protection Riders for Motor Insurance

The NCB earned on the vehicle is 25% or more and no claims in the premium 2 years or a brand new vehicle entitled to 25% or more NCB can opt for this cover. This NCB will be protected if not more than one claim is made during the policy period provided that the renewal is affected on or before 90 days of expiry of the policy. The clause also provides that claims for damage to all glasses or partial theft of accessories only have occurred and no other damages to the insured vehicle have been claimed, the loss will not be treated as a claim by the insured. In the event of theft of vehicle, if insured purchases a new vehicle and insures with the insurer within 90 days of the theft, the existing NCB will be applicable. In effect the loss will not be treated as a TL/CTL. The insured is required to provide Renewal Notice or copy of previous policy with declaration of NCB along with the proposal form to avail of this cover.

No Claim Bonus(No Claim Discount)

A form of experience rating in which policyholders are allowed a discount from the basic premium according to a scale that depends upon the number of years since the last previous claim. In practice, the systems often do not claims where the policyholder was not at fault (“allowed claims”) and will usually still provide some discount if a claim is made after a previously long claim free period. It is used most often in Motor Insurance and occasionally in other classes such as Householders, Personal Accident, Health, Shopkeepers, Office Umbrella etc.