The second hand or used automobiles market is developing in a steep upward curve in India encouraging dealers and buyers alike to opt for used vehicles. Purchasing a used vehicle stands as a very clever choice, bearing in mind the wide price differentiation factor between an old and a new car. Given the possibility of effortlessly narrowing down on a used vehicle due to the various businesses and companies specifically catering to the same, consumers are comfortable in buying used cars. The biggest aspect in consideration being the price factor usually pushes one towards buying a used car, therefore bolstering the used car market to become more organised and transparent. However, for both sellers and buyers the entire process could stand intimidating.
It is no undisclosed fact that buying a used vehicle instead of a brand new one can save one money, whether it is a new driver shopping for their first car or been driving for years. In the decision of buying a used car, there is involved an important facet of insurance, which protects the vehicle against unforeseen or unfortunate circumstances and incidents. Contrary to the common belief, buying a used car doesn’t really stand as an assurance of paying less for insurance. There are various factors that influence the cost of a car insurance including the type of car purchased, the kind of coverage opted for the vehicle, the driving experience and more. Also, there arises a question that does buying a used car affect one’s car insurance coverage and the cost of insurance? Here it is important to know that after purchasing a used vehicle, getting the insurance transferred in the buyers name becomes very crucial otherwise unwanted problems will arise while making a claim. If the insurance policy is not transferred to the buyer, it will sit invalid.
The kind of insurance for a used car
One may likely require the equivalent coverage for a used car as that of a brand new one. Conditional to the age and value of the car, a decision has to be made to go for various coverage like third-party or comprehensive coverage saving on premium to cover the cost of repairs to the vehicle when damage arises. It is advised to go through a licensed broker to help compare car insurance costs and scout the precise coverage for the situation.
Owing to low awareness, cases of insurance grievances post-loss are quite widespread about car coverage among the general public in India. Hence, it is imperative for individuals to know that transfer of insurance is a crucial aspect in the process of buying a used vehicle and ignoring or procrastination of the same will result as a liability to the owner. To avoid any legal hassles that may arise in the future, individuals selling the vehicle have an equal accountability of ensuring the transfer process of the insurance in the new owners’ name.
Highlighted below are five points that will help understand the procedure of insurance policy transfer that will encourage a smooth transaction taking place:
1. The buyer must make certain that the insurance policy is transferred in the name of the new owner immediately after purchasing a used car within 14 days.
2. To make sure that the entire procedure is accomplished with ease and to assist policy transfer, the buyer has to fill a fresh insurance proposal along with submitting the evidence of sale. The transfer of the registration certificate, Forms 29 and 30 duly signed by the previous owner along with the previous policy copy and the transfer fee has to be submitted to the insurance company. The insurance company will thereafter license the endorsement of transfer.
3. The documents as listed above are adequate enough to initiate of policy transfer in the name of the new owner. The submission of a copy of new registration certificate will support evading any hitches at the time of making a claim after it is issued by the regional transport office, as the change of possession in the registration certificate may take some time at the Regional Transport Office.
4. On the occasion of a claim, in case the insurance policy has been transferred but the transfer in the registration certificate copy is not completed or the proof of same is not made available to the insurance company, the new owner will have to provide the proof of transfer of registration certificate to the insurance company to make certain that the claim is settled.
5. The claim will not be renounced if the transfer of insurance is still in process. However, it will be compensated after the proof of transfer in registration certificate has been given to the insurance service provider.[“Source-moneycontrol”]