Role of insurance in the purchase or sale of a used car
The used car market is thriving and for the right reasons,many people prefer buying a second hand car for various reasons ranging from a limited budget to ensuring they practice their hand at the wheel with a used car before buying a brand new set of wheels. Owning a car is now an essential for commuting and used cars cater to the budgets of those who don’t have deep pockets. And while you go about testing the car and getting it inspected by a verified mechanic,don’t forget that transferring the ownership of the vehicle is just as important and insurance is a crucial part of the transfer process. Here is guideline to follow regarding the transferring of car insurance and we are sure these nuances will prove helpful whether you are the buyer or seller of a used car.
Transferring ownership of motor insurance:
If you are a seller,ensure to double check if the policy has been transferred in the buyer’s forum. Ensure to obtain the no claim bonus certificate instantly after the transfer of the policy. If you are a buyer,the insurance policy ownership should be transferred into your name within 2 weeks of the vehicle purchase. Post two weeks,there is a high chance that a claim could stand to be rejected
Know about the no claim bonus status:
No claim bonus is the bonus that a policyholder can avail if he/she has had a claim free policy period. This benefit can vary from 20-50% based on the number of claim-free years acquired. While the seller can transfer an insurance policy for a used car,the NCB is not transferable as it stays with the policyholder rather than with the policy.
Choosing the right insurance provider and plan:
A critical aspect while changing ownership of car insurance is to decide whether you wish to continue with the same insurance company or switch. It is crucial to choose a car insurance policy as per your needs and requirements. Doing ample research before zeroing on an insurance provider is a must and some factors to look at are the no. of cashless garages,the turnaround time for claim settlement and if the network of service centers is vast and widespread. Some other factors to check would be the sum assured and the premium being charged.
During the renewal of the policies,if no claims are made,the premium of the current year will be generally less than the last year. If the bonus of no claim has been obtained by the policyholder,the premium can be decreased depending on the conditions of the premium paid in the last year. To know more in detail click here.
Neglecting any of these pointers can prove expensive to both the parties,so safeguard your car while you save big on your used car and we assure you will have breezy ride ahead.
Disclaimer:The above information is for illustrative purpose only. For more details,please refer to policy wordings and prospectus before concluding the sales.
This blog has been written by
S. Gopalakrishnan | Motor Insurance Expert | 40+years of experience in insurance industry
A veteran in insurance industry. S. Gopalakrishnan is a name to reckon with in the field of reinsurance,he has headed the Reinsurance department and has rich experience in other fields of motor insurance. He loves to share his opinion on latest topics in the insurance industry and how he can help people in safeguarding their assets using insurance products.
S. Gopalakrishnan recommends "HDFC ERGO for your vehicle insurance needs, it has always put customer’s interest at the forefront, with round the clock assistance to deal with emergency breakdown issues and hassle free claims process. You can be assured of complete and reliable guidance through the whole process".