Know about motor insurance on a second-hand vehicle

Getting yourself a vehicle is always quite thrilling. It doesn’t matter whether this is your first car, a new two-wheeler or a second-hand one. The entire process of looking for something you like, finding something that fits your pocket and finally getting the keys is a truly wonderful feeling. But, dealing with insurance on a second-hand vehicle can seem tricky. So, we’re here to break the process down a bit. Here’s what you need to know about getting your second-hand vehicle insured as a buyer:

Ensure you check the vehicle's insurance policy before completing the payment. Note down the insurance company's name and the policy number. Then, call the insurance provider to check the vehicle's claim history. Doing so sheds some light on the kind of repairs the car or bike has had to go through, allowing you to make an informed decision.

The vehicle you purchase should already have an existing insurance policy. However, you may find the coverage inadequate. In such cases, you can choose to buy a new policy. To do this, you must ensure that the car has been transferred to you and that the registration certificate is in your name. Once done, you can purchase your preferred policy to protect your vehicle.

Alternatively, you can transfer the existing policy to your name after purchasing the vehicle.

The Motor Vehicles Act of 1988 made it mandatory for vehicles to have at least third-party coverage. Failing to update the name could leave you open to fines and penalties.

Motor insurance policies offer financial protection against damages caused by accidents, theft or unforeseen events. Updating the name in the policy ensures no gaps in coverage.

Having the correct insured name on the policy facilitates a smooth claims process in case of accidents or damages.

You have 14 days to transfer the name on the insurance policy. During the transfer period, the third-party liability coverage remains active. However, the rest of the plan's coverage will not stay active. 

Once you purchase the vehicle, you must ensure the registration certificate gets transferred to your name. The seller must submit Form 29 to the Regional Transport Office (RTO) to complete the process. Form 30 confirms the request made in Form 29. The transfer of registration becomes the proof of sale.

Next, you must contact the insurance company. Submit the transfer of registration, your identity and residence proof and other required documents to request the name change.

The insurance company will evaluate your request, verify the documents, and then endorse the policy with the updated name.

The insurance company may adjust the premium amount based on your profile, location, and the vehicle's details.

Now, assume you're on the other end of the deal. Instead of purchasing the vehicle, you're selling it to somebody. You must ensure you transfer your policy benefits to your next vehicle. Remember, you can carry over your No-Claim Bonus (NCB) to the new vehicle and policy. Ensure you complete the paperwork before handing over the keys. Along with the sale affidavit and delivery note, you should also have Form 28 ready. This form is an application for an NOC stating that you are no longer liable for the vehicle you have sold. You will also have to sign Forms 29 and 30 to enable the vehicle’s new owner to transfer the existing policy in their name. Before transferring the policy, call your insurance provider and make sure that NCB gets transferred in your name. This way, you can save your NCB and transfer it to your next vehicle’s policy.

Remember to inform your insurer about this change. It is vital to get the insurance transferred to your name while purchasing a second-hand vehicle. The process to complete the transfer is quick and easy, and as long as you complete it within the stipulated time, you can enjoy continuous coverage. Once you have the policy you need, you can enjoy a smooth and easy journey every time.