5 Factors to Consider before Car Insurance Transfer
The used car market has seen significant growth during the last few years. Almost 22 used cars are sold for every 10 new automobile sales. When you choose to buy a second hand car, there is a lot of work you need to do. You must research your options, inspect the cars, and test drive before making your decision. Finally, you need to transfer the registration certificate (RC) and insurance policy to own the vehicle for transferring the ownership.
You may choose to continue with the same company or shift to another service provider. Before you shift the policy, you need to consider the following five factors:
1. Insured declared value (IDV)
The IDV is the maximum sum assured you will receive in case of damage or theft. Therefore, choosing a higher IDV when you decide to opt for car insurance transfer is important.
2. No claim bonus (NCB)
As a new owner, you will have no accumulated NCB. However, for every claim-free year, you will receive a discount on your car insurance plan. If you have already accumulated NCB, it is important you check if the same will be applicable in case you choose car insurance policy transfer.
3. Discounts and offers
Some insurance companies offer discounts if you are a member of the Automobiles Association of India. Furthermore, you may be able to reduce the premium if you install anti-theft and safety devices. In addition, if you opt for a voluntary deductible, the premium may be lower on the used car insurance transfer. It is recommended you check all such offers before you make a decision.
4. Claim settlement ratio (CSR)
CSR represents the number of successful claims settled by the insurance company. It is advisable to check the CSR to ensure you will face no trouble in case you need to file a claim during the policy term.
5. After-sales service
You do not want to be stuck with an insurance company that does not offer good and reliable after-sales service. It is recommended you read customer reviews before you commence the procedure of your second-hand car insurance transfer.
Take a look at some of the other things that you need to know before making a transfer.
Documents needed to transfer car insurance
Vehicle registration and title
Consent form of the new owner
Existing insurance documents
Reasons to transfer car insurance policy to another person
Procedure to transfer car insurance
You must complete the transfer within 14 days from the purchase date
Submit a fresh proposal form along with proof of sale
Submit RC transfer and Forms 29 and 30 signed by the previous owner
Pay the car insurance name transfer fee and old policy copy
If you have to transfer the vehicle from one state to another, you need to complete the following formalities:
Check hypothecation status
Ensure vehicle emission norms are complied with
Understand the state transfer costs, such as road tax
Apply for the no objection certificate (NOC)
Arrange for state transfer and bank NOCs, original car documents, and original vehicle purchase invoice
After moving to new state, pay applicable road tax before applying for registration
Before you undertake the car insurance transfer procedure, compare premiums offered by different companies. You must ensure the coverage under the new policy commences on the expiry of the existing policy. Check all the benefits before moving to another insurance company.