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Car Insurance For Used Cars In India

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The used car market in India is growing by leaps and bounds. Getting a second-hand vehicle is a very smart decision, considering the fact that there is a wide difference in price between an old and new car. It is also possible to effortlessly narrow down on a used car as there are businesses that specifically cater to the same.

However, the entire process may be intimidating for both sellers and buyers. In this situation, the checklist below will be very useful in ensuring that the transaction happens in a hassle-free manner.

Car Insurance For Used Cars

Checklist For Sellers Of Used Cars:

In case you are the seller of the car, there are certain things to bear in mind:

  • Insurance transfer - Ensure that you transfer the insurance policy to the new owner, if requested for. In case you have paid the premium for its insurance, you should add the proportional amount to the cost of the car.

Consider a scenario in which you have paid the annual premium for your car’s insurance and 5 months later, you decide to sell it. You can add the remaining premium, i.e., the amount corresponding to the insurance for 7 months to the cost of the vehicle, as the new buyer would then be paying for his share of the premium.

  • You should remember to get the NCB retention letter from your current insurance provider. You should know that transfer of insurance does not imply that the NCB you earned under the policy will be transferred. In fact, the NCB is a reward from the insurance provider to the car owner for refraining from raising claims in a policy year. So, at the time of a car sale, you can preserve the NCB you earned through the NCB retention letter and use it on the insurance of another vehicle you own.
  • In case you are cancelling the insurance of your car, send a written notification to your insurance company and get a confirmation from them. This way you can avoid being charged premium for the insurance of that vehicle in the future. The following documents are required for cancellation of your existing insurance policy:
    • Original policy letter
    • Form 51, i.e., the certificate of insurance
    • Application for the retention of NCB
  • Car maintenance records - If you keep detailed records of the maintenance activities and repairs performed on your vehicle, you may be able to negotiate with the buyer on a better price. Additionally, you will appear to be a very diligent owner, improving your chances of striking a better deal.
  • Written contract of sale - Ensure that you have a written contract that explains the condition of your car, the date of transfer of ownership, the sale price, the insurance details, and registration particulars. Legal ownership of a vehicle depends on its registration papers; so make sure that all formalities are completed after the conclusion of the sale agreement. This can also help you in the event of disputes in the future.

Checklist For Buyers Of Used Cars:

When you are purchasing a used car, pay close attention to the available models and decide on an appropriate one. You may be tempted to go for high-end cars owing to the attractive price tag on offer. But make sure that the maintenance and insurance cost of the vehicle will be within your budget. You have to think about the expenses you will incur in the long run and act accordingly. Apart from this, listed below are certain factors that you should consider:

  • Assess the condition of the vehicle - The vehicle you are planning to buy should be in good condition. Take the car for a test drive and check how it works. Pay close attention to the engine, transmission, cooling, and wheels; you may even get these checked by a mechanic. This will help you in determining whether the car is a value-for-money proposition. After buying a used vehicle, when you are at the dealership to collect it, you should inspect the car again. This is crucial because in the event of the dealership not being an established one, the vehicle parts may be replaced after your assessment. For instance, the dealer may exchange new tyres for old ones. So be careful when you go and collect the vehicle.
  • Registration details - Make sure that the seller furnishes all papers required for verification of ownership and registration. Validate whether the seller is the actual owner of the car and check the history of change in ownership of the vehicle. Also ensure that the owner has paid all dues and has the road tax receipt. The original invoice of the vehicle and the No Objection Certificate (NOC) from the car financing authority is mandatory as well.
  • Insurance details - Check the Insured Declared Value (IDV) of the vehicle in the insurance policy documentation. This is very important as the IDV is a benchmark of the value you are liable to receive from the insurer in the event of a total loss claim. Keep track of the No Claim Bonus (NCB) earned under the insurance of the car for the past 3 years. This is useful in determining the frequency at which the car was involved in accidents and underwent repairs.

If required, you can transfer the seller’s motor insurance policy in your name. Alternatively, you can buy a new car insurance policy within the first 14 days of transfer of ownership of the vehicle.

  • Check for modifications - When buying a used car, you should check whether it is possible to get it upgraded for greater safety, comfort, or value. You may have received a second-hand car at a great price, but it may not be conducive to upgrades. So, make sure you have checked it thoroughly before signing on the dotted line.

FAQs:

  1. How do I decide on a used car in India?
  2. Finding the most appropriate used car can be a challenge. The basics involve understanding your budget and the size of car that would suit your lifestyle. When assessing the cost of purchase, you should also consider the maintenance cost of the vehicle that plays a significant role in the long run. If you have a big family, then choose a car that has more seating than a small car.

    You should check the past condition of the vehicle and get all the right documents so as to establish that it is not a stolen vehicle. Also, think about the estimated duration for which you will be in possession of the vehicle. In case you intend to keep it for a longer period, you can consider buying a new car instead of a used one.

  3. What are the advantages of buying a used car?
  4. When looking to buy a car, you will find that used cars come at a fraction of the cost of a new one. This is particularly useful for cost-conscious buyers. Currently, Maruti tops the list in the used cars market. Another advantage of choosing a used car is the fact that you can save considerably on the premium of insurance of such a vehicle.

  5. What are the disadvantages of buying a used vehicle?
  6. One of the most crucial aspects that you have to bear in mind when buying a used car is the authenticity of the source of purchase. The used car market is prone to fraud; so be very careful and pick a source that is trustworthy. Also, ensure that the vehicle you are buying has the following papers:

    • Registration certificate that shows the ownership history
    • Car insurance certificate
    • Original invoice and bills on the service work done
    • Pollution Under Control (PUC) certificate
    • Certificate from the municipality on the registration of the vehicle (This is relevant only for cars that are registered in a municipal area)
  7. Can I get a car loan for buying a used car?
  8. Yes, there are several banks that offer car financing for used vehicles. The interest rate on the loans for used cars is typically higher than that offered for new cars. The financing bank would inspect the vehicle and then offer the loan

  9. Where can I buy used cars from?
  10. The most convenient option is to buy it from a friend or relative. There are several used car sales portals online and offline; so explore all the options before deciding on a vehicle.

GST Update: GST of 18% is applicable on car insurance effective from the 1st of July, 2017

Car Insurance Reviews

Page 1 of 50 1 2 3 4 5
  • HDFC Ergo Car Insurance
    "Very good"
    0.5 5.0/5 "Blown Away!"
    Even my car was insured with HDFC Ergo. It is a second-end car and have chosen the third party insurance. I have not done any claim so far. The premium is reasonable. It offers bumper to bumper facility and road side assistance. The policy period is 2 years.
    Was this review helpful? 0
    , bangalore
    Reviewed on Jan 14, 2019
  • Tata AIG Car Insurance
    "Good Insurer"
    0.5 5.0/5 "Blown Away!"
    My financier suggested the Tata Aig general insurance, the premium is economical for the car policy. I have honda amaze car it got insured with them. The insurance company is providing 24 hours service, cash less garages, brake down service for the tenure of four years. On time I got the papers from the Tata Aig.
    Was this review helpful? 1
    , tirupur
    Reviewed on Jan 10, 2019
  • Tata AIG Car Insurance
    "Good Insurer"
    0.5 5.0/5 "Blown Away!"
    My financier suggested the Tata Aig general insurance, the premium is economical for the car policy. I have honda amaze car it got insured with them. The insurance company is providing 24 hours service, cash less garages, brake down service for the tenure of four years. On time I got the papers from the Tata Aig.
    Was this review helpful? 0
    , mumbai
    Reviewed on Jan 10, 2019
  • National Insurance Car Insurance
    "Excellent Service"
    0.5 5.0/5 "Blown Away!"
    I had taken this Insurance policy for my Maruti Car and i had been paying the premium on an annual basis. The premium amount has not been too high and there has been cash less garages available with this insurance policy. Their customer support has also been helpful at times.
    Was this review helpful? 1
    , pune
    Reviewed on Jan 09, 2019
  • ICICI Lombard Car Insurance
    "Nice Policy"
    0.5 4.0/5 "Great!"
    My car was insured with ICICI Lombard. Last year i have purchased this insurance policy. My wife has referred me about this policy. I pay the premium amount of Rs. 13500. They have given me a convenient IDV value. I had no claim experience so far.
    Was this review helpful? 0
    , new delhi
    Reviewed on Jan 09, 2019
  • New India Car Insurance
    "Need to improve the service"
    0.5 3.0/5 "Satisfactory"
    I'm not satisfied with the service provided by new India. I have bought the car insurance policy. They closed their branch on every weekends hence its difficult to renew the policy. I have been paying the premium amount of Rs. 14000 which is a competitive price. They have given the IDV value of Rs. 1.50 lakhs.
    Was this review helpful? 0
    , mangalore
    Reviewed on Jan 09, 2019
  • New India Car Insurance
    "Average Car Insurance"
    0.5 3.0/5 "Satisfactory"
    My car insured with the New India Insurance company. I have been renewing the policy with the same company for 3 years. I have paid the premium amount of Rs. 7000 and they have offered me a satisfied coverage value. The documentation process was fine
    Was this review helpful? 0
    , mangalore
    Reviewed on Jan 09, 2019
  • review Car Insurance
    "Its Good"
    0.5 3.5/5 "Pretty good"
    Last year I had car policy with Bharthi axa whenever I try to renew it ask my poliy no, whenever I mention the same, it shows the its incorrect. If I try to reach the customer care its not reachable. I done the claim, some minor damage back side of the car, they have processing fee 1500. Remaining all taken care by the insurer.
    Was this review helpful? 0
    , bangalore
    Reviewed on Jan 08, 2019
  • ICICI Lombard Car Insurance
    "Great Policy"
    0.5 4.0/5 "Great!"
    ICICI Lombard has a good brand value hence i have selected the car insurance policy with this card and the dealer has also recommended about this policy. I pay the premium amount of Rs. 9000 and this is a 100% coverage with bumper to bumper facility. I'm not sure about the IDV value. Its easy to renew the policy.
    Was this review helpful? 2
    , new delhi
    Reviewed on Jan 08, 2019
  • ICICI Lombard Car Insurance
    "Good"
    0.5 5.0/5 "Blown Away!"
    Previously my car was insured was with ICICI Lombard and it was offered by the showroom. I got a call from the representative for the policy renewal as reminder. I got the insurance paper. I have not done done a claim. It is a comprehensive with zero dep. The premium was high so changed my insurer.
    Was this review helpful? 1
    , mumbai
    Reviewed on Jan 08, 2019
  • Future Generali Car Insurance
    "Good"
    0.5 4.0/5 "Great!"
    I have taken a car insurance from Future Generali through online portal. The premium was reasonable and also they have provide bumper to bumper facility. The policy period is one year. There is no interaction between the customer service. I just gave my car for the claim so no experience.
    Was this review helpful? 0
    , mumbai
    Reviewed on Jan 08, 2019
  • Oriental Insurance Car Insurance
    "Good insurance company"
    0.5 2.0/5 "Expected more"
    Dealer has referred me about this oriental car insurance when i purchase the vehicle. They have rejected the claim since the copy of FIT is not available. They have given me a coverage value upto Rs. 6 lakhs. For the past 3 years i have been renewed the policy with the same company.
    Was this review helpful? 1
    , chennai
    Reviewed on Jan 07, 2019
  • Iffco Tokio Car Insurance
    "Good Policy and you can try"
    0.5 4.0/5 "Great!"
    Two months before, i have taken my car insurance policy with Iffco Tokio. Its a PAN India agreement policy for my Maruti Car. I don't remember about the coverage value. This is a zero depreciation policy. I paid the premium amount of Rs. 6500. I have not seen any add on and cashless garage facility.
    Was this review helpful? 1
    , chennai
    Reviewed on Jan 07, 2019
  • Reliance General Car Insurance
    "Its Excellent"
    0.5 4.0/5 "Great!"
    My brother is working with Reliance hence I took my two wheeler policy from this insurance company. I have hyundai accent car, they are providing cash less garages for the damage. I have zero depreciation bumper to bumper policy for the term of one year.
    Was this review helpful? 0
    , mumbai
    Reviewed on Jan 07, 2019
  • Reliance General Car Insurance
    "Good Policy"
    0.5 5.0/5 "Blown Away!"
    My car insurance policy was taken with reliance. The dealer has provided me a policy with this policy. This is a 100% coverage value which covers the bumper to bumper facility, They have given me a IDV value of Rs. 11 lakhs. I pay the premium amount of RS. 33000.
    Was this review helpful? 0
    , thane
    Reviewed on Jan 04, 2019
  • HDFC Ergo Car Insurance
    "Good service provider"
    0.5 4.5/5 "Excellent!"
    The reason to avail HDFC Ergo policy, my banker have suggest this insurer for my car. They gave me the best insured value around Rs. 6 lakhs based on the vehicle age. I have Hyundai I20 car, they are providing 24/7 helpline and cashless service.
    Was this review helpful? 0
    , chennai
    Reviewed on Jan 04, 2019
  • ICICI Lombard Car Insurance
    "Good Policy to take"
    0.5 3.0/5 "Satisfactory"
    My car was insured with ICICI Lombard. I pay the premium amount of Rs. 22000 and i have been renewing the policy continuously for 2 years. They have provided me a no claim bonus. Its covered with bumper to bumper facility. My dealer has recommended me about this policy when i purchase a car.
    Was this review helpful? 1
    , chennai
    Reviewed on Jan 03, 2019
  • Iffco Tokio Car Insurance
    "Good Policy"
    0.5 4.0/5 "Great!"
    I have a car insurance with IFFCO TOKYO from last 1 year, there was no claim experience so far with this insurance policy. I pay a premium of Rs 5500 for this car insurance. This is a first party insurance with 0% depreciation and the coverage value is good.
    Was this review helpful? 0
    , new delhi
    Reviewed on Jan 03, 2019
  • Bajaj Allianz Car Insurance
    "Good Policy"
    0.5 4.0/5 "Great!"
    I have a car insurance policy with Bajaj allianz from last 2 years, a premium of Rs 13000 has to be paid for this insurance policy. There was no claim experience so far with this car insurance. This policy has full coverage with 0% depreciation.
    Was this review helpful? 0
    , secunderabad
    Reviewed on Jan 03, 2019
  • Tata AIG Car Insurance
    "Good Policy"
    0.5 4.0/5 "Great!"
    I am having a car insurance with TATA AIG from last 1 year, a premium of Rs 7272 has to be paid for this car insurance policy. I did not claim anything so far from this insurance policy. I am happy with the plan benefits and policy coverage of this insurance.
    Was this review helpful? 0
    , hyderabad
    Reviewed on Jan 03, 2019
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