Two-wheelers are a preferred mode of transport across India due to their convenience, affordability, and ease of navigating traffic. Whether it is a standard two-wheeler, a scooty, or an electric bike, buying and selling used motorcycles has become common.

Therefore, it becomes crucial to handle the issue of two-wheeler insurance transfer properly as well. Transferring the policy on time ensures compliance with local and national laws and provides both parties with protection and peace of mind.

Keep reading to understand the process of transferring policy after a bike sale.

Steps to Transfer a Two-Wheeler Insurance Policy

When a two-wheeler is sold, transferring its insurance to the new owner is essential to ensure legal compliance. Here is the step-by-step process to make this transfer smooth:

• Step 1: Inform the Insurance Company: Make sure to inform your insurer immediately after buying or selling the bike. Ask for the transfer of the two-wheeler insurance policy in the buyer's name.
• Step 2: File Application for Transfer within 14 Days: The policy transfer application by the new owner must be made within 14 days of the bike purchase to avoid lapses in coverage, particularly for third-party liability.
• Step 3: Complete RTO Ownership Transfer: Upon visiting the RTO, initiate the ownership transfer process by submitting Form 29, Form 30, and the Sale Deed to legally update the bike's ownership.
• Step 4: Submit the Required Documents: Furnish the essential documents to the insurance company.
• Step 5: Enrol or Change Your Coverage: The new owner may continue with the same policy or tailor it to their coverage needs, such as adding on or getting comprehensive cover.
• Step 6: Get Your Vehicle Inspected by the Insurer: The insurer will send an investigator or surveyor to inspect the bike's condition. As part of verification, an inspection report will be prepared.
• Step 7: Pay the Transfer Fee: A nominal transfer fee is payable to the insurance company to process the name change and update the policy details.
• Step 8: Receive the Updated Policy: Once the insurer completes all verifications, a revised insurance policy is issued in the new owner's name, marking the completion of the transfer.

Documents Required for a Bike Insurance Transfer

Bike insurance plays a vital role in shielding your two-wheeler while ensuring your financial well-being by covering damages and legal obligations arising from unforeseen events. It ensures that riders stay safeguarded against repair costs, third-party claims, and other unexpected expenses while on the road.

To complete the insurance transfer process smoothly, certain essential documents are required. These documents for transferring two-wheeler insurance include:

• RC (Registration Certificate)
• Vehicle details
• Original insurance policy
• Driving license
• PAN or Aadhaar Card
• NOC (No Objection Certificate) from the former policyholder
• Information regarding the premium paid for the original policy
• Personal information of both the buyer and seller:
• Contact information

Why is Bike Insurance Transfer Important During Sale?

Here are the key reasons why transferring bike insurance is essential for both buyers and sellers:

• Ensures Legal Compliance
  

As per Indian Motor Laws, insurance policy transfer is mandatory. Anyone having bike insurance in the previous owner's name could result in fines, penalties, and other legal obligations. Completing the two-wheeler insurance transfer validates the new ownership and ensures that the rider remains compliant with traffic and insurance regulations.

• Protects Against Future Liabilities
  

If the policy is not transferred, the third-party claim will be denied, and the new owner will be held legally responsible. Updating policy and properly transferring it keeps such issues at bay and ensures claims are paid to the right person without hassle.

• Supports Financial Protection for the New Owner
  

In the absence of an insurance transfer, the new owner might find no coverage in the event of theft, accident, or natural disaster. Thus, policy transfer ensures instant coverage, budget savings, and financial backing from the very first day of ownership.

• Allows Sellers to Retain Their No Claim Bonus (NCB)
  

NCB in bike insurance is a crucial and valuable premium discount that increases with each claim-free year, helping policyholders save significantly at renewal. It acts as a reward for responsible riding and becomes an important financial asset over time.

While selling the bike, the seller can notify the insurer and retain the No-Claim Bonus through an NCB Certificate. It ensures that the seller carries this benefit forward and enjoys reduced premiums when buying a new policy.

• Prevents Claim Rejection
  

If the new owner files a claim without the policy being transferred, there is a high chance the insurance company will deny the claim because the policy still reflects the previous owner's details. Completing the bike insurance transfer ensures claim acceptance, smooth settlement, and continuous protection.

Transferring bike insurance when selling your two-wheeler is a crucial step that ensures legal compliance and peace of mind for both the seller and buyer. The two-wheeler insurance transfer process enhances the resale value of your bike and builds trust between the parties involved.

If done properly by following the proper steps and submitting the required documents on time, this process can be seamless and hassle-free. As a result, both parties will remain satisfied and secure.