A used car insurance policy is coverage that is allowed on used cars. It can come in two variants basic third party liability only cover or comprehensive package cover. You may choose to opt for either one of these options when buying a second-hand car.
The best thing about buying a used car is that you can find the right option for your budget. You can also make sure the car will be in good condition before committing to it and it would be much cheaper if you are looking to buy a premium or luxury vehicle.
When buying a used car, you also need to insure it with a valid policy. The Motor Vehicles Act, 1988 mandates a liability only used car insurance policy on the car before you take it out for a ride. So, let’s understand the policy in detail.
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5 Essential Tips for Buying Your Used Car:
Buying a used car is not always easy, but the tips below can help you get the best deal.
1. Check the vehicle history report: A vehicle history report will tell you if there are any accidents or other problems with the vehicle. It’s important to know that these reports are not always accurate and they can be manipulated, so it’s important to take them with a grain of salt.
2. Get an inspection: You should invest in an inspection by a trusted mechanic before you buy your next used car. Many things aren’t visible to the naked eye and could cost you thousands of dollars if they need to be fixed later on.
3. Know what you want: You must know what kind of car you want before you start browsing the used car market. Some used cars are going to be more expensive than others and some models are going to be harder to find.
4. Get a vehicle history report: A vehicle history is important because it will allow you to know what kind of car they were driving before they got rid of it, how old the car is if there was any major work done on the car, and what kind of repairs the car has had.
5. Check the model year: The year the car was built is important because it will allow you to know how old the car is and how good its condition should be.
Why should you opt for Second-Hand Car Insurance?
You need a used car insurance policy because of the following reasons:-
1. Financial security
If you're injured by your car, the insurance will cover any legal costs. These liabilities can be considerable, especially in the case of the death of a third party. In the absence of a used car insurance policy, the liabilities can cause a financial strain on you.
2. Easy claim settlements
If you are at a connected car garage, your second-hand car insurance will cover any necessary repairs. As a result, you can get your car fixed with ease and without worrying about money.
3. Legally mandatory
Third-party coverage is legally binding. You need to have third party insurance on the car before you drive it. If you are caught without valid insurance, you could be fined or imprisoned depending on the severity of the offense
4. Comprehensive coverage
If you buy a comprehensive old car insurance policy, you can get coverage for damage to your car. This type of insurance covers mishaps like fire, flooding, vandalism, and theft. If someone hits your car with their car it may be covered too. Under the comprehensive policy, however, the repair costs would be paid by the insurance company taking off a huge financial burden from your shoulders.
5. Security in case of thefts
If your car is stolen, you would be able to claim a used car insurance policy. This lump sum payment would then allow you to buy another car more easily.
So, for fulfilling the legal mandate and enjoying financial security, a used car insurance policy becomes a must.
Difference between Second-Hand Car Vs New Car Insurance Policy:
| Comparison |
Used Car |
New Car |
| Coverage |
Third Party |
Third party |
| Insurance Validity |
Age of the Car |
Age of the Car |
| Budget |
Low Budget |
Depends on the Market Value |
| First User |
Yes |
Yes |
| Interest Rate |
Higher |
Lower |
How to Deal With Used Car Insurance Policy?
Buying and selling second-hand vehicles also ensure transfer insurance too. Failure to lapse of possession to the new owner will face severe consequences thereafter. After a lot of research, you decided to buy a used car, buying a used car is been an absolute choice for a middle-class segment.
Both buyer and seller should understand the policy terms & conditions precisely. Instances, of used car insurance policy frequent to insurance companies, and new owner files a claim without transferring the insurance policy in his name. Here, a claim is invalid as there is no legal contract between the new owner and the insurance company.
Steps to Consider While Buying Second-hand Car Insurance Policy:
Nowadays used car sales online increased tremendously, there are many pre-owned car showrooms and online portals to provide the best finance for used cars. Availing all these perils people are interested to buy used cars online.
Buy Car Insurance for used cars online from our website. Up to 60% discount is offered by different car insurance companies for used car insurance online. The insurance has to be purchased in the name of the person as mentioned in the RC copy. This implies that the insurable interest is maintained at the time of claim as well and prevents the rejection of the claim due to deviation of insurable interest.
- Transfer of registration certificate (RC)
Submit Forms 29& 30 at your RTO (Road Transport Authority), which should be signed by the previous and new owner, and avail NOC (No Objection Certificate) from the previous owner with duly signed, this helps to speed up the registration process.
- Transfer insurance policy
If your RC is transferred and your used car insurance is not yet transferred; in this case, your right to claim for damages is nullified.
- Possible instances to avail insurance
Change the name of the previous policy owner- Transfer the used car insurance plan in your name along with the RC take a copy of Forms 29& 30 to assure the possession in your name. To make the whole process simple you can get assistance from the insurance companies online.
As per Sec.157 of the Motor Insurance Policy used car insurance policy should be transferred within 14 days of the purchase. If the vehicle encounters an accident, third party insurance is covered within 14 days of purchase.
The previous owner does not possess an insurance plan- There are some instances where the previous owner does not get the insurance policy. In this scenario, a new owner has to get the new policy with the present insured declared value. The best way to buy used car insurance is to go online to check quotes for used cars on PolicyBachat.com and buy a policy online easily.
- Transfer No-Claim Bonus
No Claim Bonus is given to the policy-holder transfer of possession does not mean the transfer of NCB. NCB discount can be used by the previous owner if he purchases the new vehicle. The new owner has to bear the difference amount of discount availed.
Getting Car Insurance for second hand cars is the same as a new car but you need to handle the process of changing the name by submitting proper documents. Taking proper steps in transferring policy documents in your name will be a benefit for your vehicle. We advise you to get the policy transferred within a specific time and to avail claim for any damages.
Everything to Know Before and After the purchase of Second hand:
Car is one of the most desirous things among this generation of people. With the advent of technology the prices of cars have come down and now the car has become one of the most affordable items. But some people still cannot afford the brand new car, these people look for other options such as second hand cars or used cars.
The process of buying a new car and insuring it is quite simple but the process of buying a used car or second hand car and insuring it is tedious and requires patience and carefulness. This article tries to explain the process of insuring your second hand or used car.
Process before purchasing a Used Car:
Step 1: The first step while purchasing the used car is to check for the validity of insurance as well as the authenticity of the insurance policy. If the seller is providing the insurance copy which is valid and lives, then you can proceed with the purchase process.
*Road Transport Office (RTO) requires at least Third party insurance policy copy for registering the used vehicle.*
Step 2: If the seller is not providing the live and valid insurance copy then it is advisable to take out insurance in the name of the seller and get the registration done. After registering the vehicle in your name you can apply for name transfer.
Step 3: Get the vehicle registered in your name and don’t forget to ensure that the vehicle is insured before taking out the vehicle in public places. As per the Motor Vehicles Act, it is compulsory to take third party car insurance before driving in public places.
Process after purchasing a Used Car:
There are 2 scenarios after purchasing the used car in terms of insuring it. One is to purchase a new policy or the other is to apply for name transfer in the existing policy copy.
1. Taking New Policy:
If the vehicle is having only a Third party Car insurance and you want to go for full coverage of your vehicle, then you can take a new Comprehensive car insurance policy along with the required add-ons. These add-ons are to be selected based on your requirement and are not a compulsion.
The process of taking a new insurance policy is simple, visit the online website for car insurance online and do the car insurance comparison using the car insurance calculator, get the best car insurance quotes and select the best one and do the car insurance payment online.
Online> Fill the details> Get a quote> Payment Successful > Policy Copy
After taking the new policy you can start driving your vehicle and be safe and secure as any loss or damages to your vehicle are now covered by the insurance company.
2. Process of Policy Transfer:
The process of policy transfer to your name is made quite simple these days with the advent of technology and the process can be done within 1 day.
- To transfer a policy in your name, a fresh proposal form has to be filled along with the evidence of transfer i.e.: a new RC Copy. These documents are to be submitted to the nearest branch of your insurance company.
- A nominal fee is to be paid to the insurance company to process the name transfer request.
- The insurance company may demand inspection of the vehicle in some cases which will be carried out by the insurer and based on satisfactory name transfer will be done.
- Once the name transfer is done the new policy copy reflecting your name will be shared with you.
Documents Required For Transferring Policy:
- Original Registration Certificate (RC) with new buyer’s name
- A copy of the car policy
- The transfer fee and transfer of registration certificate
- New proposal form
- The new copy of the registration certificate
- Forms 29 and 30 bear the signature of the previous owner
- Certificate of Insurance
- Old policy document
- No Objection Certificate from the previous policyholder
- No Claims Bonus difference amount, if any
Things to remember purchasing a Used Car Insurance Policy:
If the insurance is in the name of the previous owner and a claim has come, then there is a chance that the insurance company may repudiate your claim. So, always ensure that the insurance is in your name after the purchase of a used car.
Ensure that the insurance is valid at all times and renew before the policy expiry period. Most insurance companies may reject the pre inspection report of your car if there are any existing damages to the car in case of expired car insurance renewal.
For car insurance expired cases inspection can be done using the link sent by the insurance companies or physical inspection would be carried out based on the need. Without inspection, the insurance companies would not accept the risk.
- Condition of the car
- Ownership of the car
- Valid car insurance policy
- Car insurance claim history
- Important documents
- Possibility of modifications.
The best website to purchase old car insurance is where there are dedicated agents to assist you in buying car insurance policies as per your needs.
How to Buy/Renew Used/Secondhand Car Insurance Online?
Used Car insurance can be purchased online from the PolicyBachat portal in two easy steps. At PolicyBachat we cater unbiased comparison of quotes, and a 24*7 customer assistance team whose motive is to give our customers the right quotes with compare car insurance rates online.
- Go to compare car insurance quotes online at PolicyBachat.com
- Fill in the required details and select your Car Model & Variant, RTO Location, Registration date, and Email address.
- Click on the “START SAVING MONEY”.
- Choose between a Third-Party Liability Only and a Standard Package (Comprehensive Insurance).
- Premiums with different insurance companies are displayed with low premiums
- Select required Add-ons/Riders and discounts, or you can Edit Policy Details as per your requirement
- After that fill in the ‘vehicle owner details and personal details.
- Purchase the best Car Insurance Policy using online payment.
- If any queries are raised call: 1800–123–4003.
Frequently Asked Questions:
How Much Does Used Car Insurance Cost?
The cost of used car insurance varies depending on the vehicle. Aside from the age and value of the vehicle, all used cars are not in the same condition. In addition, various motor insurers may charge different premiums for used car insurance coverage. Insurance rates for used cars will vary based on several factors, including:
- Where you live
- The minimum coverage required by your state
- With your age, insurance rates can be higher for young adults and older drivers
- The car's make and model
Is It Cheaper To Insure A New Car Or A Used Car?
When purchasing a new car, it can be cheaper to insure the vehicle if you carry comprehensive or collision coverage. A used car will generally cost less than a new vehicle to repair or replace because it is worth less. However, car insurance rates depend less on whether the car is used or new and more on the details of the vehicle and your policy, including the car's make and model, your location, and the amount of coverage that you carry.
What happens if I fail to Transfer my Second-hand Car's Insurance Policy?
If you transfer your car insurance policy to your name it will be protected and you will be able to file claims in emergencies. Make sure the transfer is done before going abroad!