Everything About Insurance For Second Hand Cars
Looking to purchase insurance for second hand cars? Read this article, to know about the best type of insurance for second hand cars.
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Second-hand cars are the most preferable choice for middle-class families as they help in saving a lot of money. But how? The market value of a car continuously depreciates. As a result, second-hand cars can be bought at cost-effective prices.
However, the rules and regulations for second-hand car owners are the same as for newly bought cars. This means it is mandatory by law for all vehicles, whether new or old, to be insured with a valid car insurance policy. Read on to understand the second-hand car insurance policy in detail.
Why Is It Necessary To Insure Second-hand Car?
In India, according to the Motors Act, it is mandatory to buy third-party insurance for vehicles. With this type of insurance, a policyholder can get coverage only for third-party liabilities. However, if you buy a comprehensive second-hand car insurance policy, the insurance company will also cover the damages incurred to you and your vehicle. Listed below are some of the reasons that justify the need to insure a second-hand car.
- Natural Calamities:
If you own a comprehensive second-hand car insurance policy, the insurance company will cover all the expenses that happen due to natural calamities such as storms, floods, earthquakes, and much more.
- Burglary or Theft:
We invest our hard-earned money in a car purchase. Isn’t it? Hence, the theft of your newly bought second-hand car may financially strain you. Therefore, insurance companies come to the rescue and provide complete protection against theft if you have bought a comprehensive insurance policy.
- Man-made Calamities:
Besides natural calamities, the insurance company is liable to pay for all the damage that occurs due to man-made disasters such as vandalism, fire, terrorist attacks, and more if your second-hand car is covered under a valid comprehensive car insurance policy.
- Road Accidents:
A comprehensive policy offers protection for the vehicle and its owner in addition to third-party coverage. Thus, the insurance company will bear any damage or injury that happens to the policyholder.
Things You Should Keep Know About Second-Hand Car Insurance
Sometimes, buying a second-hand car can bring a lot of documentation and paperwork to be completed with them. Below mentioned are the things that you should be aware of while insuring your second-hand car.
- Transfer of Car Insurance:
Just like the car registration, you will have to transfer the ownership of the insurance policy into your name. You cannot customize the insurance policy before the renewal date. Therefore, you can also apply for a new insurance policy and tailor it according to your requirements.
- Claim History Of Existing Plan:
When purchasing a used car, examine and validate the past claim history from the previous owner, as well as cross-check it with the car insurance company. You merely need to offer the policy number to the car insurance company to obtain information about the vehicle's claim history.
- Car Inspection:
The insurance provider will do a comprehensive inspection of your used car to determine its condition, age, damages done, total distance driven by the vehicle, ease of availability of spare parts, and much more.
How to Transfer Ownership of an Existing Car Insurance Policy to Your Name?
The process for transferring the existing insurance policy of your second-hand car from the first owner to your name is as follows.
Step-1: Fill out a new proposal form and provide evidence of the sale, such as the transfer of the RC (Registration Certificate), Forms 29 and 30 signed by the first or prior owner, a copy of the previous insurance policy, and the transfer fee receipt. The insurance company will approve the transfer after obtaining these documents.
Step-2: Submit a copy of the new RC provided by the RTO (Regional Transport Office) to your car insurance company.
Step-3: When filing a claim, you must provide the insurance company with proof of the transfer of the RC in order to receive the reimbursement if, for any reason, the change of ownership is not reflected in the new copy of your vehicle's registration certificate (RC) even after you had the insurance policy transferred into your name or you had neglected to provide the company with the necessary documentation.
Step-4: However, if the transfer of the car insurance policy is still in process, your claim request won't be turned down. Consequently, you wouldn't get the claim money until you provided documentation showing that you had transferred the RC to your insurance provider.
Documents Required To Transfer Second-hand Car Insurance Policy
Listed below are the documents that you need to submit at the time of transferring an existing motor insurance policy to your name.
- Original RC and insurance policy document
- Clearance certificate
- Duplicate of Pollution Under Control Certificate
- Application for transferring ownership
- And others asked by the insurer
Thus, it can be concluded that buying a motor insurance policy for second-hand cars is as important as buying a new vehicle. You can either transfer the ownership of the existing car insurance policy to your name or buy a new one as per your specific needs.