7 Consequences of Ignoring the Transfer of Used Car Insurancea

7 Consequences of Ignoring the Transfer of Used Car Insurance

Auto Insurance

Do you know that buying cheap car insurance in India is never a good option, because by doing that you are not only settling for a high deductible but also getting inadequate coverage and add-ons for your car, such as RSA and zero depreciation car Insurance?

While you are transferring your used car insurance, you need to know that the current market value of the used car is much less as compared to a new one and if you fail to transfer the ownership, then the outcome can turn out to be alarming for you. But don’t worry, let’s find out about it in this comprehensive guide!

Impact of Not Transferring Used Car Insurance 

 1. Buyer’s Point of View

  • Having a casual approach, regarding not transferring the insurance to your name, can result in not qualifying for claims in case of accidental damage or theft. If it is concerned with a used car, then you need to transfer the insurance to your name on an immediate basis.
  • Ignorance by the previous owner, concerning the used car insurance transfer will lead to legal problems in the future.
  • In situations, where you are found driving a used car that lacks a valid insurance policy, then in those cases, the traffic police would impose a fine or cases can even go to imprisonment.

 2. Seller’s Point of View   

  • As per the Motor Vehicles Act, you are liable to insure your used car with third-party car insurance. If you fail to do so, you can face a lot of legal obligations, especially in cases involving an accident with a third party.
  • The seller ensures that the amount of the insurance is transferred immediately after the sale is made.
  • Being the original owner of the car, you have the right to insure the same to be protected financially against third-party liabilities or against any damages that may happen to your car.
  • By any means, if you are unable to transfer your used car insurance in the name of the new owner, then, in that case, you have to cover up for the damages caused by the vehicle driven by the new owner as instructed by the Motor Accidents Claim Tribunal.

How to Transfer Insurance for Second-Hand Cars?  

The process of second-hand car insurance transfer is more simplified as compared to purchasing insurance for a new vehicle. Follow the below steps to get know-how on how to transfer insurance for used cars:

  • Hand on all the documents like registration certificate, form 29 and form 30, and sale deed keeping all your important documents in hand.
  • Fill out the proposal form and submit it to the RTO (Regional Transport Office) to initiate the process of transfer.
  • Choose the comprehensive car insurance plan with the required add-on covers.
  • The surveyor will evaluate your car to process the necessary insurance policy.
  • After the evaluation, the insurance will be transferred from the old owner and registered in your name.

Things to Keep in Mind for an Effortless Used Car Transfer 

  1. Car Insurance for a secondhand car should be transferred from the old owner to the new owner within two weeks or 14 days from the date of sale.
  2. In this case, if the new owner does not initiate the process, the previous car owner should remind the new owner about the policy transfer so that future legalities or any kind of financial troubles can be avoided.
  3. To get the insurance policy for your used car in your name, it is mandatory to fill up a fresh proposal form with the motor insurance company, and in addition to this, you also need to file Forms 29 and 30 with the insurance provider.
  4. The change in the ownership of the car is reflected by the change of name of the car owner in the registration certificate that you have to apply for duly.         


While you buy car insurance your policy must provide adequate coverage against various adverse events. So if you ever think of buying a cheap policy you should always ponder upon the perspectives of “cost-effectiveness” which would offer the ultimate value for your penny. Once you buy online car insurance you can have the liberty to choose between the appropriate insurance policies as per your needs.

Frequently Asked Questions 

Can I transfer the authority of my car insurance online?

Ans. No, you cannot do that. You have to be physically present at your RTO office and must submit all the necessary documents that are required to transfer the car’s ownership to someone else.

What are the documents needed in case I want to retain my NCB?

  • A letter of cancellation of the insurance policy.
  • A copy of the original insurance policy.
  • Ownership notice transfer of the vehicle which means Form 29.
  • Intimation of the transfer of ownership.
  • Copy of the registration certificate.

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