How to Transfer Car Insurance to A New Owner?

It has become common practice to buy and sell second hand cars these days. If you are planning to sell your four-wheeler, this blog is for you! Almost all of us would think that the job is done once we have received payment for the vehicle and we transfer it to the buyer’s name. However, it does not end there. You also need to transfer your vehicle insurance to the buyer without fail.

Why should one transfer vehicle insurance?

Insurance policies – Most insurance policies require that car insurance has to be transferred in the name of the new owner as soon as a sale is made.

To retain No Claim Bonus – If you have not availed for reimbursements for your car recently, you might have accumulated a No Claim Bonus (NCB). This can be used to reduce your insurance premiums in the consequent years and stays with you even if you buy/sell your vehicle. 

Ensure a smooth transition of the car insurance to the new owner so that your No Claim Bonus will stay intact, and you continue to enjoy the benefits it provides.

To remove liabilities in case of accidents – In case the ownership is not transferred properly and the car meets with an accident eventually, you might become liable for damages. Remove all responsibility and liability from your side by transferring the car insurance policy to the appropriate person.

How to transfer vehicle insurance?

Transferring vehicle insurance has been made simple and fairly easy, and for the most part can be done online. Here are the steps you need to take – 

  1. Get a Sale Affidavit – Once the car is sold, get a sale affidavit and delivery note ready and have the buyer sign it.
  1. Ensure availability of ID proof and proof of financial transaction – Obtain copies of the buyer’s ID proof, which can be Aadhar card or passport. Also, have proof of the method of transaction the buyer pays you. Have the sale affidavit notarized once the buyer signs it.
  1. Fill Forms 28,29,30 – Download the Forms 28,29, 30 from the RTO website or collect it from the local RTO office. These forms are essential for transferring the insurance policy to the buyer. We shall briefly see what each means – 
  • Form 28 – This is an application form to get a No Objection Certificate (NOC) from the RTO. It helps to ascertain that you have no legal liabilities with the vehicle.
  • Form 29 – This form is an official intimation to the RTO about the change in ownership of the vehicle. Before submitting this form, you will need to hand over documents such as Vehicle Registration Certificate, insurance and PUC certificate to the new owner.
  • Form 30 – This is a confirmation that all necessary legal documentation has been transferred to the new owner.
  1. Obtain a Clearance Certificate – This is a formal communication to the

RTO that the sale has been completed. Details of the buyer are included in the clearance certificate.

We hope this article has provided you with all the information you need to know about transferring vehicle insurance. A smooth transfer of insurance helps you stay on the right and safe side of the law, and protects you from future liabilities. 

You won’t have to worry about any incurred damages if you have car insurance. Choose the best car insurance policy that suits your needs, from Insurance to have a safe, worry free driving experience. Drive safe. Happy Motoring!

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Dan Dunn
Executive Managing editor

Editor and Admin at MarkMeets since Nov 2012. Columnist, reviewer and entertainment writer and oversees all of the section's news, features and interviews. During his career, he has written for numerous magazines.

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