Importance of insurance transferNote that a vehicle insurance policy comprises two components – comprehensive cover which includes own damage and third-party cover. While section 157 of the Motor Vehicle Act puts the onus on the new owner to get the insurance policy transferred to his/her name within 14 days of purchase of the vehicle, it’s important for you, the previous owner, to provide all the help in doing so. Note that during these 14 days, only the third-party cover of the insurance is automatically transferred.
The comprehensive cover doesn’t get automatically transferred. It gets transferred only when the insurance is registered under the new owner’s name. Note that in case the policy isn’t transferred in the name of the new owner and is still in your name, then the insurer will not pay for any damages suffered by the vehicle or third-party. Also, you can receive a notice by the court to compensate for the losses suffered by a third-party for a mishap caused by the new owner.
Transferring vehicle ownershipPrior to transferring insurance, it’s essential to transfer vehicle ownership. For this, you need to provide the new owner:
- Original registration certificate (RC)
- Duly signed form 29 and 30 along with the transfer fee and copy of the previous policy
- Affidavit regarding transfer of ownership
Transferring vehicle insuranceOnce the ownership is transferred, it’s time to transfer the insurance policy. The following documents are required for doing so:
- Application for ownership transfer
- Original registration certificate
- Previous insurance copy
The final wordThough the onus of getting the insurance transferred lies on the new owner, as evident, it’s important for you, as the previous owner, to get involved in the process as many documents require your signature. Also, helping the new owner acquire the ownership certificate and vehicle insurance frees you from any liability arising in the future for his/her fault.
Also, in case both of you face any difficulty in the process, you can always seek professional help. In fact, most insurers have a dedicated team that takes care of the transfer process. Knowing the rules and being vigilant work in favour of both parties and make the entire process smooth and hassle-free.
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The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.
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