Do you know the right way to transfer a car insurance policy? Or, what is the need to transfer a car insurance?
When you buy or sell a used car, transferring the car insurance policy is an important step that many people forget. Car insurance does not automatically transfer to the new owner. It must be updated properly to avoid future problems. If the policy is not transferred on time, the new owner may not receive claim benefits in case of an accident.
In this guide, we will explain the steps to transfer your car insurance at the time of sale correctly.
What is Car Insurance Transfer?
Car insurance transfer means changing the policy ownership from the previous owner to the new car owner.
When you buy a used car, the insurance policy does not automatically transfer to you. You must inform the insurance company and update the policy details. After the transfer, you become the legal policyholder and can receive full insurance benefits, including claim support.
Essential Documents Needed to Transfer a Car Insurance Policy
Here are the documents you will need to transfer a car insurance policy:
- Original Policy Document: You will need a copy of the existing car insurance policy.
- Registration Certificate (RC): A copy of the updated RC showing the buyer’s name is needed.
- Forms 29 and 30: These forms are required for notifying and applying for the transfer of vehicle ownership.
- No Objection Certificate (NOC): If required, then submit a NOC from the previous owner.
- Buyer’s Details: ID proof, address proof, and passport-size photographs of the new owner are also necessary.
- No Claim Bonus (NCB) Difference: If the previous owner keeps the No Claim Bonus, then you need to pay the difference in premium.
Key Steps to Transfer a Car Insurance Policy
If you have bought a used car, transferring the car insurance to your name is very important. It protects you financially and keeps you legally safe. Here are the simple steps you need to should follow to transfer your car insurance policy:
Step 1: Firstly, Update Your RC
First, make sure the car’s Registration Certificate (RC) is updated after the car transfer. Most insurance companies require the updated RC before the car insurance transfer.
Step 2: Inform About the Owner
Then, inform the existing insurance company about the vehicle sale or transfer. Share details about the sale and the new owner’s information.
Step 3: Get Ready with Documents
Keep all the necessary documents ready. This will make the process faster and smoother.
Step 4: Submit the Required Documents
Fill out the policy transfer form and submit it along with all the required documents. Make sure everything is correct to avoid any delay.
Step 5: Inspection, if Required
In some cases, the insurer may inspect the vehicle. This usually happens if the transfer request is delayed or if the Own Damage cover expires.
Step 6: Fee Payment
The insurance company may charge a small transfer fee. Pay the required amount to complete the process.
Step 7: Transfer Completed
Finally, the transfer of car insurance will get completed by the insurance company.
What If You Do Not Transfer Car Insurance
If you do not transfer car insurance after the sale of your car, then you can face any of the following issues:
- The claim for the sold car can be rejected.
- Own Damage cover does not apply.
- Fines can be applied for not having valid insurance.
- You have to pay repair costs yourself.
Conclusion
The steps to transfer car insurance after buying a used car are simple and important. It ensures that you are legally protected under the car insurance.
If you delay or ignore the transfer, your claim may be rejected, and you have to bear repair or damage costs yourself. It can also lead to legal issues or fines.
To avoid financial loss and future problems, always complete the insurance transfer process immediately after the vehicle ownership is changed.
FAQs
Is car insurance automatically transferred after buying a used car?
No, the insurance is not transferred automatically. You must inform the insurer and complete the transfer process to get full coverage.
How many days do I have to transfer the car insurance?
Usually, you should apply for the transfer within 14 days of buying the car.
Does the No Claim Bonus (NCB) transfer to the new owner?
No, the NCB belongs to the previous owner. The new owner cannot use it.
Is a vehicle inspection required for insurance transfer?
Sometimes, yes, especially if there is a delay in applying for the transfer or if Own Damage cover needs to be updated.
Can a claim be rejected if insurance is not transferred?
Yes, the claim may be rejected if the policy is still in the previous owner’s name.
