A good car insurance policy can be beneficial in an accident or damage. Thus, the new buyer of your car will want it. This is why people look online for how to transfer car insurance to another person. There can be a lot of situations when the need for transferring insurance coverage arises. For instance, when you know longer own the car.
When you choose to sell out your car, then you need to see that the new owner of the vehicle gets the insurance policy transfer to their name. While if you are purchasing a second-hand car, then you need to get the insurance policy in your name.
Besides these, most people choose to transfer car insurance to retain the no-claim bonus and to avoid any future liabilities. Irrespective of the reason, understanding how to transfer car insurance is extremely important.
So, if you are wondering how to transfer car insurance to another person, then the information presented here will be helpful for you.
Transferring the car insurance policy
The transfer of the four-wheeler insurance policy works in coordination with the ownership transfer. Once you have sold the vehicle to another person, your policy will not be valid.
This is because both the address and the name on the registration certificate and the documents have to match according to the IRDAI for raising a claim. The same is not possible if the car has been sold.
Besides, the transfer of car ownership will become essential in case of an emergency. Also, it will be handy for the new owners to get adequate coverage for any loss or damage. In addition, when the vehicle is creating an issue, it can deny the claim.
You need to be well aware of the process you have to undertake to transfer the car insurance to another person. For this, you must submit a transfer request with the insurance provider. Besides this, you have to pay transfer fees and provide proper documentation to complete the process. This will include.
• The registration certificate’s copy
• New application form
• The previous car policy documents
• No objection clause presented from the previous policyholder
• No claim bonus difference amount
• Inspection report
Understanding the No Claim Bonus
When you have decided to sell your car, then it is essential that you sign over the insurance and the registration details to the new owner. However, there can be an unusual scenario in the case of car insurance transfer. This is the no-claim bonus.
It is a reward from the insurance provider for a safe driver who does not make any claims during the policy year. Herein the NCB percentage can be used for reducing any premium renewables. In fact, when you have got a higher number of years in the policy, the discount you will be receiving will be quite high.
Once the insurance policy is transferred to the new buyer, the NCB can be retained. However, you will have to produce an NCB retention letter to the new insurer. The letter can make the previous policyholder eligible for discounts on the insurance premium of the new car.
In no way the no-claim bonus can be transferred. Thus, while buying or selling a car, you must be clear about the details. Generally, the car insurance can be transferred to the new owner, but NCB is never transferred.
It will be helpful if you enquire about the same with the insurance provider to ease the experience. Also, you can look for how to transfer car insurance to another person online to find the details of the same.
Who transfers the car insurance policy?
The seller is responsible for transferring the existing insurance policy to the car’s new owner. The transfer needs to be carried out within 14 days of the sale. During the first 14 days, the third-party cover is automatically transferred and stays active on the vehicle.
However, the damage covered will only become active after the policy has been transferred from the previous owner to the new one. If the transfer is not made within 14 days of the sale, then the third-party cover will cease to exist.
Conclusion
The buying and selling of cars can be a complicated process, especially when it comes to the transfer of insurance policies. You need to look for how to transfer car insurance to another person to understand the process in detail and ensure you take the right measures on time.
This will help you stay ready with all the documentation and the cost associated with the process.