Buying a Used Car? Ignoring Insurance Transfer Could Be Risky

When you buy a car, new or used, you take care of it like a baby. You keep cleaning it and try your best to prevent it from harm. But in case it goes through an unfortunate accident, you are left shattered. Here comes in the car insurance company like your friend to comfort you by providing financial support and aid for the damages that your car has incurred.
Car Insurance is an insurance policy which protects your car against any damages or incurred during an accident as well as theft.

The Motor Vehicles Act of 1988 states that it is mandatory for a vehicle to have a third – party insurance. There are two types of motor insurances, namely, third – party and comprehensive. The comprehensive insurance covers the third – party liability as well as self – damages. Any self – driven injuries, self – damages to the car, damages to the third – party’s car, injuries caused to the third – party, theft of the car, vandalism to the car, losses due to any actions to the car, legal protection against the legal actions posed by the third – party are covered in the comprehensive car insurance.

All vehicles must have Third–Party Car Insurance Plan and always keep the documents handy while driving. The Third–Party Car Insurance Plan covers any damage or injury caused by the insured, to the third-party, another person or property. Basically, this insurance offers cover against any legal liability to a third party caused when you’re at fault.

Buying A Used Car

When you buy a used car, it is extremely important to get the car insurance transferred. The previous car owner must already have got the car insured as it is mandatory by the Indian Law. So, now you have to get the car insurance under your name as you have purchased the used car. When buying a used car, you end up doing a lot of research to see if it is the best choice you are going to make. It involves research about the car, weighing the options, having the car inspected, taking it out for a test drive, finding out if it has already been in any accidents or has any damages earlier and if it has any illegal record against it and if it runs on petrol or diesel or if the car’s engine is in proper power. Now, after all these procedures and checking, come the formalities of buying a used car. You have to get 2 things done:

Transfer of the Registration Certificate

• Transfer of the Car’s Insurance Policy
• Insurance Transfer

Insurance transfer in case of buying a new car is an important formality one should not ignore. If you don’[t get it transferred, you might be losing out on a lot of benefits and might even face legal action as a car insurance is mandatory by law in the country of India. The IRDA – Insurance Regulatory and Development Authority of India states that the insurance should be transferred to the new owner from the previous owner within 14 days of the transfer of the registration certificate. If you fail to do so within the time – limit, the claim won’t be paid for own – damage to the vehicle if any.

Ignoring Insurance Transfer Is A Very Risky Affair

• Losing Out On Own – Damage ClaimIf you ignore the transfer of the insurance policy, that too within 14 days of the transfer of the registration certificate, you will lose out on the own – damage claim of the insurance policy which will leave your car uncovered for any damages or loss or theft or vandalism by the car insurance policy.
• Legal Action Against YouAs car insurance is mandatory by the Indian Law under the Motor Vehicles Act of 1988, it is an offense not to have insurance or not to have had it transferred to you by the previous owner of the vehicle.
• No CoverWell, it is obvious that you won’t be covered by the insurance if you don’t have an insurance policy under your name, now that you have the car registered under your name. Getting the insurance transferred is as important as getting the certificate of registration transferred. You will lose out on the financial support and aid that an insurance cover provides in case of any unfortunate and unforeseen accidents that cause damages and injuries.

Do not ignore the transfer; it can be done easily by submitting the following documents:

• Insurance policy document, the older one
• New registration certificate copy
• NOC – No Objection Certificate by the previous owner or insurance policy holder
• New proposal form
• No Claim Bonus – NCB recovery or difference amount
• A nominal Transfer fees to be paid to the insurance company; it is usually between INR 50 to INR 100
• Inspection report; inspection to be carried out by the insurance company

Make sure to get the car insurance policy transferred after you get the certificate of registration transferred. Do not ignore this very important step. Drive safe!