Bikes are a convenient and economical mode of transportation. They often cost less than cars, and their smaller and slimmer structure makes them much easier to move through the busy lanes packed with traffic. It is clear that the usage of two-wheelers will only increase over time.
Given its convenience and high usage, you must know some of the basic requirements, such as the significance of good bike insurance, its renewal, or transferring the vehicle’s registration papers to the new owner in case you sell your bike. But did you also know that you have to transfer your bike insurance? No? Not to worry, with this article, we’ll introduce you to the basics of the bike insurance transfer process. So, let’s usher in.
Why is It Necessary to Transfer Bike Insurance to the New Owner?
As pleasant as they seem, roads are still dangerous places, and accidents are unpredictable, so anybody can get in an accident. If you don’t transfer the complete insurance documents of the vehicle just sold by you to its new owner, then they will not be able to file any claims for any unforeseen expenses they might encounter with the new vehicle.
If such a situation arises, they would be responsible for covering any damages themselves. In the event that a third party is engaged, the financial burden could be too much to bear. So, transferring bike insurance is not only really advantageous, but also essential for the new owner of your bike.
The advantages of transferring insurance also apply to the vehicle’s previous owner. Any financial liability for future accidents involving the sold two-wheeler rests entirely with the former owner. With the help of an NCB certificate sent out when the transfer is finished, they also get to carry over their no-claim bonus (NCB).
Advantages of Transferring Bike Insurance
Did you know that, as per Section 157 of the Motor Vehicles Act, it is the buyer’s obligation to apply to the insurance provider and seek a transfer of the bike insurance policy to his name? The application must be submitted within the span of 14 days after purchasing the vehicle.
It’s crucial to remember to transfer the insurance to its new owner when selling your bike, as failing to do so can hold you liable for any damage that may arise in the future.
The following are a few advantages of transferring bike insurance:
- Obtain your NCB Certificate: The bike insurance provider will provide you with an NCB certificate if you haven’t filed any claims under your policy. You can use this certificate to gain a discount when purchasing a new insurance policy in the future. You can get up to a 50% discount on your new insurance policy if you have a no-claim bonus.
- Protect Yourself from Future Liabilities: If the policy is still in your name and the new bike owner gets in an accident, you will be held responsible for covering damages caused by them. Also, this goes both ways; the new owner won’t be able to make any claims for damages if the policy is yet to be transferred.
- Less Trouble: One of the main advantages of transferring your bike insurance policy is that you won’t have to deal with any hassles and can rest easy knowing that the policy is already transferred along with your bike. Additionally, if anything unfortunate happens to a third party, you can sigh relief knowing that you will not be held responsible for it.
Required Documents for Bike Insurance Policy Transfer
The following documents are supposed to be submitted to effectively transfer bike insurance ownership from one party to another:
● Original registration certificate (RC) of the vehicle
● Passport size photo of the buyer
● Buyer’s residential address proof
● An inspection report by the insurance company
● All the insurance policy documents (recent one and the original one)
● Forms 28, 29 & 30 have the buyer’s as well as the seller’s signatures. These are forms that are required for the registration of a motor vehicle.
Steps to Transfer Bike Insurance Policy
Selling a bike involves more than just handing the buyer your keys. To transfer your bike insurance to the new owner the right way, you must thoroughly follow these steps.
Transferring insurance is a much simpler and hassle-free process if you follow the correct steps. Below are some detailed steps that will help you with this endeavour.
- Step 1: Submit an application for insurance transfer within 15 days of legally transferring ownership of the two-wheeler. It’s better to start the insurance transfer process simultaneously with the ownership transfer process.
- Step 2: For successfully transferring bike insurance coverage, a few documents are necessary, such as the RC, documents verifying the date of ownership transfer, the original insurance policy paperwork, the name of your dealer, and the history of insurance premium payments all need to be kept on hand at all times.
- Step 3: The owner’s and the buyer’s KYC documents must be present. Bring your PAN card, Aadhaar card, driver’s licence, and other necessary documents to maintain a record of this transfer.
- Step 4: You can broaden coverage to your new bike by simply including another vehicle in your existing insurance plan. However, the pro-rata formula may impact the rate of premium.
- Step 5: The seller must produce proof of third-party insurance as part of the policy transfer process—this aids in estimating the insurance plan’s future premiums.
Selling a bike has its own benefits, as it allows you to retrieve a substantial part of the money required for your new ride. People are also always looking for second-hand bikes at a bargain. When you sell your old bike, don’t forget to transfer your bike insurance too. While most people remember to transfer their registration certificate, they realise the importance of doing the same with their vehicle’s insurance.
Going forward, if the bike gets involved in an accident and you haven’t made the transfer, it might cause serious legal issues for both you and the new owner.
Disclaimer: The above information is for illustrative purposes only. For more details, please refer to policy wordings and prospectus before concluding the sales.