When people subscribe to a car insurance policy, they are generally confused about the insurance if they buy a second-hand car. There are several car insurance policies out there for second-hand cars too. This kind of vehicle insurance is termed used car insurance. These insurance policies are aimed at protecting second-hand cars and their owners.
Like any other car, second-hand cars are also prone to accidents and damage. These car insurance policies protect second-hand cars from all externalities and risks. Generally, used car insurance covers almost everything that is covered by car insurance for a new car. The policies include damages and any third-party liabilities that might cause any damage to the car or the person driving the car. Before you take your used car for a spin outside, make sure it has a liability-only insurance policy, as it is a mandate laid down by the Motor Vehicles Act of 1988. You can also avail yourself of second-hand car insurance online.
Reasons to Get a Second-hand Car Insurance
While you might think that your second-hand car has a less lifetime value, any unpredicted accidents can throw you off-guard, and huge repair costs might land on your lap. Hence, investing in car insurance for your second-hand car is important.
Below are some reasons you should invest in a second-hand car insurance policy -
- Risk Protection: A second-hand car is prone to different kinds of risks. These risks can be natural or man-made. Therefore, you need car insurance to protect your second-hand car from all these externalities. Some of these risks include car accidents, theft, damage by fire, damage by a landslide, etc.
- Compulsion: According to the Indian Motor Vehicles Act 1988, all cars plying on the roads should have valid car insurance. It is a government mandate, and you will have to adhere to it if you want to drive your second-hand car on the streets of India.
- Third-party Liabilities: Most used car insurance policies include car damages and other third-party liabilities like injuries, property damage, etc. Hence, having a third party car insurance policy at least for your second-hand car protects you from any other major costs you may incur if you meet with a third-party accident.
Buying an Insurance Policy for Your Second-hand Car
Buying a car insurance policy for a used car is not a challenge. Once you know the steps, you can easily apply for car insurance online. Sometimes, a used car comes with an existing car insurance policy. This happens if the previous owner of the vehicle had subscribed to car insurance and the validity period has not ended.
However, if your second-hand car does not have existing car insurance, you will have to buy a new one. Listed below are some steps that you can follow to buy a new car insurance policy for your used car:
- Visit the Paytm Insurance website. Several options will pop up on your screen. Choose the 'Car Insurance' option from the list.
- Now, enter the number of your second-hand car in the space that appears on the screen. Click on ‘Get Quote.’
- You will now have to log in to the website with your Paytm credentials.
- Select the brand of your car and the name of the model.
- Once you have added the brand details, you must select your second-hand car's fuel type and model variant.
- Now, please select the year of registration when the car was initially registered by its first owner. You will find these details in the car documents you receive from the previous owner or second-hand car dealer. Also, select the place where your vehicle was registered.
- A list of insurance policies for your second-hand car will appear on the screen. You can then compare car insurance policies to understand the pros and cons of each policy.
- You can choose an old car insurance plan that gives you the kind of coverage you desire and also fits your budget.
- You must then pay the first premium amount via any online mode of payment.
- Once the car insurance provider receives the payment, it will issue a car insurance policy for your second-hand car. You can access all the necessary documents on the Paytm app and receive them by mail.
Transfer of Ownership of an Existing Car Insurance Policy
There might be a case where your car might have an existing valid car insurance policy. You must check with the previous car owner or the second-hand car dealer. They will let you know if the car has an existing insurance plan.
In such cases, you need to get the ownership of the car insurance policy transferred in your name within the first two weeks of acquiring the second-hand car from its previous owner. You must follow the steps listed below and get the ownership transferred:
- Go to the Regional Transport Office (RTO).
- Fill in the application available for the transfer of ownership of the car. You need to opt-in for the transfer of RC in your name.
- Submit all the documents of the car along with the application form.
- Once the Registration Certificate is issued in your name, you can fill out a proposal form for the transfer of ownership of the car insurance policy.
- Submit the form along with all the existing policy documents.
- Pay the fee associated with the policy transfer.
- Once you make the payment, the ownership of the policy will be transferred to your name within a few days.
Once you receive the new documents, check them for any irregularities. You must reach out to the car insurance company in case of any discrepancies.
Documents Required During the Transfer of Ownership
When you are getting the ownership of the car insurance policy transferred, you need to submit a few documents. Some of these documents include:
- The Registration Certificate that contains your name
- Duly signed forms by the previous car owner: Forms 28, 29 and 30
- Photocopies of the existing policy documents
- Original policy documents
- Insurance Certificate
- NOC from the last insurance subscriber
- Proposal Form
- Fee receipts of payments made during the RC acquisition
Wrapping Up!
Buying a car insurance policy is a mandate by the government. It includes both new and second-hand cars. Apart from the mandate, your responsibility as a car owner is to safeguard the vehicle and the person driving it from any externalities.
While getting new car insurance for a second-hand car is relatively easy, transferring ownership of an existing car insurance policy might be a little complicated. However, if you take a step-by-step approach, you can navigate the process.
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