The excitement of buying a new car shouldn’t hinder your duties related to the transfer of insurance policy of your used in the name of its new buyer. Here’s what needs to be done.
Buying a new car is one of the important breakthrough that call for a decent amount of homework. The enthusiasm of new car must not overhaul your onuses linked to the selling of your current one. While you must be conscious of several legal formalities linked to the same, we want to make sure that you don’t miss out on any related to the car insurance.
The set of rules laid down in the Motor Vehicles Act, 1988 necessitate the transfer of the insurance policy in the name of the new buyer in order to safeguard its benefits. Here’s what needs to be followed in case you’re in the process of selling your used car.
How to Transfer Car Insurance?
To transfer car insurance it is important that the ownership of the car has been successfully transferred to the new owner.
Following documents will be required for transfer of ownership:
- Original Registration Certificate (RC)
- Application Form 29, 30 (with seller and purchaser signature)
- Affidavit from the seller and the purchaser regarding transfer of ownership
- Address Proof of purchaser
- No Objection Certificate from the concerned RTO/ AETC in case of Transport Vehicles
- Valid Insurance Certificate
- Appropriate fee
Once the transfer of the car is done then you can initiate the process to transfer car insurance. The existing insurer needs to be contacted who will ask for the following documents:
- Application for transfer of ownership
- Original Registration Certificate (RC) with transferee name (new owner or buyer)
- Old Insurance Certificate
- The required fee, if any.
Once the documents and appropriate fee is paid, the insurance company will initiate the transfer of the car insurance and send the updated policy with a change of name.
Get your No Claim Bonus Certificate: If you have not claimed on your car insurance policy, you are entitled to a cumulative No Claim Bonus which discounts your subsequent own damage premiums. If you have any bonus to your credit, you can carry it forward to your new car. But, first you have to obtain the No Claim Bonus certificate from your insurer reflecting your accumulated bonus.
Important note for the Transferee:
Though transferring the policy is the job of the seller, you as a buyer should also be involved in the process because, as mentioned above, your documents and consent will also be needed along with the forms. You should not sit around for the buyer to complete the process but get the policy transferred as early as possible because if you face any claim and the policy is still in the name of the previous owner, the claim will be paid to him and not you. So, the burden of getting the insurance transferred rests on your shoulders too.
The last word
Transferring the insurance policy to another person's name is easy if you follow the steps and submit the required documents. If you are confused, you can approach your broker who will help you with the transfer process. Whatever you do, make sure you complete the process and transfer the policy so that you are free from any legal technicalities which might entail if there is a claim for your old car.