Let us call you back. Just share your number for a call back in less than 15 minutes

We can’t proceed without your mobile number. Help us?
Sigh. We need the reason for call back to pick the right person for the job. Help us?

Is it super urgent? Call us on our Toll Free numbers

BTW, we respond to email queries with lightening fast speed. Send email instead?


Someone from the team will get back to you ASAP!


Oh! Just in case you still need our Toll free

1800 209 9970
Also schedule a callback Also send an email

Your Claim Assistance request has been registered with us.

We will contact you before 11am tomorrow.

If its an emergency, for immediate assistance please feel free to contact our Customer Support Unit on 1800 209 9970
image title

Buying a Used Car? Ignoring Insurance Transfer Could Be Risky

Meeta Sabnis Meeta Sabnis 21 June 2016

The emotion of purchasing a car – used or new – is entirely overwhelming. And in a rush to get on the road, you could miss out on necessary formalities, like transferring the car’s insurance in your name. Read on to get to the heart of the matter.

image title

In today's era of easy and quick deliverables, a car is a must. Other than the auto-mobile manufacturers’, the used car market has also expanded over the past decade. The reasons could differ significantly: while a learning driver may buy a used car to “get used-to-driving”, a middle-class family or young couple may have budget constraints. Whatever the reason may be, used car market is flooded today, and the below statistics testify to it.


4.2 million used cars bought in 2015

For every 10 new cars sold, 22 used cars are finding buyers

Buying a used car involves a lot of homework – researching, weighing the options, inspecting the car, test-drives, etc. And just when your efforts are at the peak to make that most-fitting acquisition, it turns out there are a couple of other mandatory formalities to be considered before you ‘own’ the car:

  • Transferring the Registration Certificate
  • Transferring the car’s insurance policy

While your car dealer and the RTO will assist you in transferring the car’s registration in your name, car insurance is something you will have to deal with yourself. It appears a little cumbersome task, but with proper knowledge and a systematic approach, it’s undoubtedly a cake walk. Let’s find out.

Insurance is Mandatory, So Don’t Squabble

Have you ever thought about car insurance while finalizing the purchase of the car? You’re not alone there. Many people are unaware that as per the Indian Motor Vehicles Act (1988), it’s an offense to drive the car without valid insurance. So, whether you like it or not, you will have to deal with its insurance when you are just about to buy a used car.

The Easy and Simple Way To Transfer the Car Insurance

As per Insurance Regulatory and Development Authority of India (IRDA), a car’s insurance should be moved to the new owner within 14 days from the date of transfer of registration, failing which no claim will be payable for own-damage to the vehicle. Here is the list of documents required for a smooth transfer:

  • Old insurance policy document
  • Copy of the new registration certificate or Form 29
  • No Objection Certificate (NOC) from the previous owner/policyholder
  • A fresh proposal form
  • Inspection Report (to be carried out by the insurance company)
  • Nominal transfer fees (Approx. Rs. 50 – Rs. 100) to be paid to the insurance company
  • NCB recovery/difference amount

Does Loyalty Matter or Should You Change the Insurer?

At this juncture, it’s entirely your choice to either continue with the current insurer or change it. With so many lucrative alternatives available in the market, we recommend weighing various quotes across insurers to settle on the most suitable plan for protecting your car. Online brokers like Coverfox.com offer a free and user-friendly platform to compare coverage options and buy the policy at a click. What’s more? Apart from an excellent after-sales service, you also get assistance of a dedicated claims team for all your claims-related concerns.

Factors To Consider Before Finalizing the Most-fitting Plan

  • Your car’s IDV: As this is the final amount you will be compensated with in case of theft or total damage—the higher, the better. However, please note that higher IDV will attract a bigger premium.

  • Discounts on offer: Most insurers offer similar discounts. Some of the car insurance discounts are as below:

  • No Claim Bonus (NCB): Since you will be the new owner of your recently bought used car, you will start with 0% NCB. With every claim free year, you can accumulate NCB. Here’s how it works year-on-year:

Plan Name New India Assurance Senior Citizen Mediclaim Policy
Private Cars
Entry Age 60-80 years
Entry Age 60-80 years
Entry Age 60-80 years
Two Wheelers
Entry Age 60-80 years
Entry Age 60-80 years
Entry Age 60-80 years
  • Membership of AAI: If you are a member of any of the registered Automobile Association of India, you can avail further discount.
  • Profession & Age-based Discounts: Certain professions like being a Government Employee, attract special discounts. Furthermore, some insurers allow age-based discounts on the own-damage premium.
  • Installing Anti-theft Devices: If your car is installed with anti-theft devices approved by the Automotive Research Association of India (ARAI), then you can avail additional discounts.
  • Voluntary Deductible Discount: If you choose to bear a part of the claim amount, then you can get an extra discount on your premium. Here’s how it specifically works:
Plan Name New India Assurance Senior Citizen Mediclaim Policy
Private Cars
Entry Age 60-80 years
Entry Age 60-80 years
Entry Age 60-80 years
Two Wheelers
Entry Age 60-80 years
Entry Age 60-80 years
Entry Age 60-80 years

Insurer’s Claim Settlement Ratio & After-sale Services: Before you pay for the insurance premium, it’s always a smart move to review the insurer’s market standing and its claim settlement ratio. Also, do read reviews about their post-sale services to help you make a well-informed decision.

The Mathematics of No Claim Bonus

Many new buyers assume that along with the transfer of the car insurance, they are also entitled to the No Claim Bonus stated on its previous policy. However, NCB is a way of rewarding the owner of the car for claim-free years and is granted to him/her (insured) and not the car. Therefore, the previous owner of the car can very well retain his/her NCB and can also transfer it to the insurance policy he/she would purchase for the new car in future.

As specified in the table above, NCB is gained in percentage over claim free years. Hence, if the previous insurance policy has any NCB discount on it, the same will be revoked while transferring the policy in your name. This change will lead to an increase in premium, and you will have to bear the difference. Many buyers do not consider this point and are puzzled when asked to pay the differential amount.

Likewise, if you are a seller, who wants to retain your No Claim Bonus, you must submit the following documents to your insurance company.

  • Request letter towards cancellation of policy
  • Original insurance policy copy and certificate of insurance (also called Form 51)
  • Form 29 (Notice of transfer of ownership of a motor vehicle)
  • Form 30 (Application for intimation and transfer of ownership of a motor vehicle)
  • Photocopy of Registration Certificate booklet with name of the new owner

In a Nutshell..

The process of transferring the insurance of a car in your name may seem pretty tiresome and time-consuming. However, with the comfort of online dealing, it’s quite easy and fast. The documents can be shared in the form of soft copies, wherever possible. What’s more? Online insurance brokers like Coverfox.com also arrange for the mandatory inspection of your car at your doorstep to simplify the process for you.

With a few formalities and documentation on time, put all your worries at rest and relish those pleasurable drives full of nothing but priceless memories.

Get lowest quotes for Car Insurance

Avail upto 60% discount on Premium.

Please enter a valid phone number
Thanks! We will get back to you soon.

I hereby authorize Coverfox to communicate with me on the given number for my Insurance needs. I am aware that this authorization will override my registry under NDNC.

Meeta Sabnis
Written by Meeta Sabnis
Her mantra in life is to dream, and dream until you turn them into reality. A neurotic Kajol fan, Meeta loves spending time with her gorgeous twins, ensuring a childhood they’ll be proud of. Bargain hunting, crazy dancing and romancing alphabets are some of her other cravings. She’s currently a Content Writer at Coverfox.