How To Change Vehicle Insurance Name​?

Buying a vehicle is a big decision, even when it is second-hand. But when it comes to buying a second-hand vehicle, people overlook the essential documentation. One essential document is transferring the insurance policy. But people don’t have clarity regarding the procedure of transferring the policy. In this article, we will get the answer to how to change the vehicle insurance name. 

What is the need to transfer vehicle insurance? 

Before we learn the procedure, we should know the reasons behind the transfer. An insurance policy protects you financially from unforeseen risks like a road accident. Therefore, if you no longer have the vehicle, then there is no sense in having the insurance policy. 

So, if you are transferring the ownership of the car, then you need to ensure that you transfer the insurance policy to their name as well. 

How to change vehicle insurance name​?

If you sell a car and don’t change the insurance name, then you will continue to hold liability related to the motor vehicle even when you sold the same. Therefore, to free yourself from such liabilities, you need to pay attention to two things. One is transactional, and the other is RTO paperwork. 

How to change vehicle insurance name​: Key Steps to follow are: 

• Update RC with RTO
  The new owner should acquire the updated registration certificate from the RTO first.

• Inform the insurer
  Inform your insurer in writing regarding the sale. Use the customer portal to inform the insurer.

Know the list of required documents 

• Form 29 and 30
  These forms should be filled out by both buyer and seller (Report the transfer of ownership)

• New RC
  The RC should be submitted with the new owner’s name.

• KYC
  The document is required to show a valid ID and proof of address of the new owner.

• NOC
  A no-objection certificate is required from the previous owner.

• Pay the transfer fee.
  There is a need to submit a small fee to update the name on the policy.

• Vehicle inspection
  Some insurers require a vehicle inspection before they update anything in the policy.

• Receive the transferred policy.
  After verification, the insurer will issue a document in the name of the new owner.

Understanding the no-claims bonus in car insurance transfer! 

The No Claim Bonus transfer means your ability to carry over the accumulated advantages when you change your insurance policy or provider. It means the insurance company considers you as a policyholder, not the motor vehicle. You will retain all the benefits and discounts to apply them to the insurance premium.

What happens if a vehicle meets with an accident? 

Just imagine a scenario where the new car owner meets with an accident before transferring the name of the vehicle. If the transfer is in process, then the insurance company will be liable to pay the third-party compensation, but only for the first 14 days that start from the date of the sale itself. Under the law, then it will be the liability of the second owner only. However, the original owner can face hassles if the insurance is not transferred within a 14-day period and a claim by a third party is made. 

Conclusion! 

Ultimately, it is in favor of both the seller and the purchaser to transfer the policy when selling and buying a motor vehicle. Use the above process to transfer the insurance without any hassle.