Is it compulsory to get a third-party insurance for a second-hand

Posted on: Jun 18, 2025 | 3 mins | Written by: HDFC ERGO Team

Is it compulsory to get a third-party insurance for a second-hand

Third party insurance for a second-hand scooty

Mr X is a college student in Kolkata, finally saved enough to buy her first vehicle- her second-hand scooter. Excited to enjoy her first dream ride, she explored the city on her bike, enjoying her newfound freedom. It was all good until her scooter bumped into a parked car.

The damage wasn't a big one, although the car owner asked for compensation. With no bike insurance, Mr X had to pay for her damages while also compensating for the car's damage because of no third party bike insurance. Similar to Mr X, many people in India buy second-hand vehicles. Reason? It's affordable. However, you cannot overlook a crucial component: third party bike insurance.

Imagine yourself driving a scooter someone else owned. Well, the price tag might be more reasonable and affordable, but that nowhere means adjusting to the risks. It is common for people to assume that a two-wheeler insurance is just for new vehicle owners. However, that is far from the truth. In India, all vehicles on the road must have third-party insurance, whether new or second-hand.

Skipping this two-wheeler insurance isn't just risky for your pocket. You might end up paying a heavy penalty while also getting your vehicle seized.

What is Third-Party Insurance?

According to the Motor Vehicles Act, all motor bikes must have a third-party insurance or liability cover, be it new or second-hand. Wondering what third-party insurance means? Well, let's see.

A third-party liability cover or insurance covers the insured in case there is accidental damage to the property of another person. For instance, causing injury or an accident to another person. This does not include the damage done to the vehicle of the insured person. To put it simply, here, one party is the insured, the second party is the insurance company, and the third party is the person whom the insured has damaged or caused injury to.

Should You Get Bike Insurance?

Having second-hand two-wheeler insurance is just like having regular insurance for your new bike. There isn't much difference. You may consider going for comprehensive bike insurance or a third-party policy.

Here are some compelling reasons to suggest why your second-hand bike needs insurance.

1. Legal Compliance The Motor Vehicle Act, 1988, makes it compulsory for all bikes to have bike insurance at all times. Having insurance ensures you are legally adhering to the rules, avoiding unnecessary fees and penalties.
2. Third-party Cover As mentioned, having a third-party insurance for your second-hand two-wheeler will ensure that you have a safety net against any damages done to a third party by your vehicle. Therefore, it gives you financial security.
3. Protection Against Natural Calamities Natural calamities like fire, earthquake, etc, are unexpected and unpredictable. In case of such events, your bike night also gets damaged. However, by having bike insurance, you'll have an assurance of having an insured value of your scooter, helping you cover some financial losses.
4. Protection Against Man-made Acts Having bike insurance also comes in handy against man-made acts like vandalism and more, which can damage your bike, leaving you with nothing but costly repairs. However, when you have comprehensive bike insurance, you can simply claim for the damages and repairs of the insured vehicle.

How to Insure Your Second-hand Scooter?

Looking to buy second hand two-wheeler insurance? Well, thanks to the digital era we are living in, now you may easily obtain bike insurance online in just a few steps.

Here is a step-by-step guide on how you may do it.

1. Consider doing research and choosing an insurance company that matches your needs and requirements. Pro tip: You may consider factors like a company's reputation, claim settlement, financial health, and more to assess a company's performance and choose a reliable insurance company.
2. Now, visit the official website of the insurance company and consider filling in essential details like your bike's registration number, your personal details, and get an insurance quote.
3. Next, you may initiate the process. Once done, the company might send you a surveyor to cross-check your vehicle's details.
4. Finally, consider paying the premium to activate your insurance. Once done, you may receive the details at your email address.

Documents Required for Buying Insurance

When thinking of buying a two-wheeler insurance, it is important to have some documents ready. This ensures you complete the process conveniently and successfully without any delays or rejections.

Here is a list of documents that you might consider keeping handy while buying insurance for your used scooter.

1. Existing or original policy document of the two-wheeler.
2. The new RC or registration certificate is linked to the new user's name and details.
3. Some passport-size pictures.
4. Document of address proof like Aadhar, PAN, and more.

Factors to Consider While Insuring Your Used Two-wheeler

Having bike insurance can benefit you in several ways. However, before you insure your used bike, it is important to consider a few factors to make the most out of your insurance. Wondering what those are? Let's have a look.

1. Make sure you have the name of the new owner on the new registration certificate.
2. Consider cross-checking the IDV or Insured Declared Value. This refers to the lump sum current market value of your bike.
3. Check the coverage, exclusions, and premium amount, as it will affect your overall insurance costs.
4. Consider checking the optional riders to make your policy more comprehensive and personalised.
5. In case you choose to change the insurance company for your second-hand two-wheeler, make sure to study the new company along with its performance and other key details.

Final Word

Owning a second-hand scooter might be economically cheaper, however, it comes with the same legal responsibilities as a brand new one. In fact, skipping bike insurance isn't simply risky but illegal. Having a third-party insurance ensures you're protected against financial liabilities caused to a third party by your bike. Further, by having bike insurance, you make yourself more aware, safe, and responsible.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to the policy wordings and prospectus before concluding the sales.

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