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How to Transfer Your Insurance Policy, Renew and Update it?

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October 20, 2022


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Figuring out how to transfer the insurance policy for a vehicle is not as hard as it looks. It is essential to make sure you transfer your insurance on time whenever significant changes happen around you — for example: selling your car or bike. The procedure for purchasing a new car is not too difficult. However, there are several small tasks to do while preparing to sell an old car, notably the paperwork process, which includes transferring the insurance to a new owner.

In this article, we shall understand how to transfer an insurance policy and how to renew an insurance policy online.

How to transfer the insurance policy?

If you’re the one buying the vehicle, then according to the terms and conditions of the insurance policy, both the Registration Certificate (RC) and the insurance policy must be in your name. This requirement is frequently ignored by those who sell or purchase used automobiles, which might result in financial losses in the event of an unfortunate incident.

It is considered the seller's responsibility to ensure that the buyer gets the required car insurance following the transport department's guidelines.To  fully comprehend how to transfer an insurance policy, let us go over the steps in detail:

1. Download Forms 28, 29, and 30 from the relevant RTO's website or office.

  • Form No. 28 is a request for a NOC from the registering authorities that act as proof that you don't have any obligations or debts that would prevent you from selling your automobile (Needed: 3 copies & the original doc).
  • Form No. 29 is used to notify the RTO that the owner has transferred ownership of the vehicle and that all required paperwork, including the PUC certificate, vehicle insurance certificate, and registration certificate, have been provided to the purchaser (Needed: 2 copies & the original doc).
  • Form No. 30 acts as a confirmation to Form No. 29 that ownership of the vehicle must be transferred and that the buyer has now assumed responsibility for any debts, liabilities, and duties related to the vehicle you have sold (Needed: 2 copies & the original doc).

2. Fill out the forms and upload them, along with any other supporting documents, to the RTO.

3. Make sure to take the RTO's Clearance Certificate as proof of the transaction and the properly filled out documents.

4. Send the required documentation to the insurance provider.

5. Pay the required fee.

6 . Get the insurance document with the new owner's name on it by email or courier.

  • The following papers must be supplied with the application to change ownership of a car or bike insurance to effectively transfer vehicle insurance:
  1. Original RC
  1. Receipt from RTO for Forms 28, 29, and 30 (application form with the signatures of the buyer and the seller) and evidence of a transaction
  1. The former owner's No Objection Clause (NOC)
  1. Verification of the buyer's address

  2. Passport-size photos of the buyer 
  1. A copy of an old but existing insurance policy
  1. A vehicle inspection report from the insurance provider

A few other pointers that are necessary to remember when transferring your insurance:

1. No Claim Bonus Certificate:

The insurance company awards you with the No Claim Bonus (NCB), a reduction in premium when you renew the car insurance policy if you have not filed any claims during the policy time. Every year without a claim, the insurer will raise this discount by a percentage.

Since the NCB is given to the car owner in exchange for not making any claims and not offering on the vehicle, it cannot be given to another person. Therefore, as a buyer, you are unable to benefit from the NCB that the former owner of the car had access to. However, you can move the NCB to new insurance as a seller.

2. Certificate of Clearance:

You require this certificate if you are transporting a vehicle from one RTO to another inside or outside the state. It includes information on the car's specifications as well as the qualifications of the buyer and vendor.

3. The policy transfer must be finished within 14 days of the vehicle's sale.

4. While the transfer is being finalised, the third-party insurance would instantly take effect in the name of the buyer for these 14 days. However, if the transfer is not completed within 14 days, the third-party insurance will cease functioning.

5. While the insurance transfer is in progress, claims made will not be denied. The insurance provider will be compensated after receiving the proof of transfer.

What happens in case of incomplete policy transfer?

You are not qualified for advantages like Own Damage Insurance (OD) or other Add-ons, according to this (if any). If you don't change the vehicle insurance policy in the name of the new owner, the insurer isn't liable for covering any losses you sustain, even those protected by your damage and third-party sections. Additionally, the court may order the previous owner to pay compensation for the harm a third party sustained as a consequence of an accident.

Reasons to update your insurance policy?

It has to be acknowledged that your vehicle insurance policy has to adjust to your changing needs with constant changes. You may not necessarily be selling your automobile, you may be moving cities and adding new members who would be using the vehicle. It's critical to update your policy if any of the initial information you provided changes. If your vehicle insurance claim has out-of-date information, the process will be unnecessarily delayed. 

Several reasons can affect your choice to change your vehicle insurance.

These changes include:

1. You had third-party insurance up to this point, but it wasn't enough. Comprehensive insurance coverage would be preferable.

2. Given that you have relocated or changed your city, you should add more protection to your prior insurance policy.

3. Because your spouse or kid has also begun driving your car, you want to add them to your insurance policy.

4. You recently purchased a new car and want to transfer your current auto insurance coverage to the new vehicle. By doing this, you can raise the sum assured based on the new car's insured stated value.

It is recommended that you tell your insurer of any changes as soon as possible so that your insurance information can be updated. If you don't, you risk losing your insurance benefits and having your coverage ruled illegal. However, it's important to remember that once your policy is in effect, you cannot make any changes, and they cannot be applied in the past.

Updating your vehicle insurance coverage is simple. Simply offering all the additional information for the increase is all that is required. By doing this, you may get the estimated premium for the modified insurance. You may finish the process online without any physical visit. All you have to do is visit the website of your preferred insurer to renew your insurance coverage.

How to renew your insurance policy?

We have now understood how to transfer your insurance and how to update your insurance policy. However, an important detail about your current insurance policy is still impending: how to renew insurance policy online.

To acquire and renew a vehicle’s insurance coverage, one used to have to call, visit the agent in person, or go directly to the insurance company. Not to mention the procedure that requires the longest amount of time: compiling all the real copies needed for the renewal. It is now simple to renew an automobile insurance policy. With a few clicks, it can be done.

After the term expires, the majority of vehicle insurance plans automatically renew after your pay the new premium amount, ensuring that you are never left without coverage. However, you will need to manually renew your insurance if you do not pay your premium on time.

An automotive insurance premium can be renewed in one of two ways:

  1. Contact the Insurance Company - In this case, you must visit the insurer's office and make a predetermined premium payment. You receive a printout of your updated insurance as well as a payment receipt in return.
  2. Renew it online: Visit the website of your insurance company and provide the necessary information, such as your email address, cellphone number, and automobile registration number. Enter the add-on to the insurance you want to choose as well as the policy information. Finish the process by making an online payment for the premium.

Inform your insurance provider right away if your auto insurance expires. During the grace period, which is 90 days after the policy's expiration date, you can renew the lapsed coverage. However, you will need to buy a new policy when the grace time is over.

In conclusion

As the vehicle seller, you should exercise the same degree of diligence and ensure that the buyer's name appears on any documents necessary. In certain instances, the insurance claim made by the new owner of a second-hand automobile has been turned down because the insurance policy was still in the previous owner's name. This is because, rather than the new owner, the insurance coverage acted as a legally enforceable contract between the previous owner of the automobile and the insurance provider.

So, when you sell your used automobile, remember the details of how to transfer the insurance policy into the buyer's name. If the policy is still listed as the policyholder in the policy paperwork and there is an accident, you can be required to pay the legal responsibilities. It is equally crucial to update and renew any vehicle insurance coverage you now have or would like to obtain.

Frequently asked questions:

1. How to transfer an insurance policy from one person to another?

You must submit a transfer request to the motor insurance provider to transfer an existing policy of auto insurance from one person to another. A few documentation and verifications must also be supplied with the transfer cost to transfer insurance.

2. Do I need to cancel car insurance when switching?

You should notify your existing insurer as soon as possible if you intend to change insurance providers. You can cancel by providing 30-day advance notice and perhaps receive a refund for the remaining time.


Fi Money is not a bank; it offers banking services through licensed partners and investment services through epiFi Wealth Pvt. Ltd. and its partners. This post is for information only and is not professional financial advice.
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