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  • How Car Insurance Works After The Death Of The Policyholder?

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    Having a car is a dream for many. Though the perspective to own a car may differ from person to person, having a proper car insurance policy is a statutory requirement. Not only does a car insurance policy provide complete protection to your vehicle, it also secures you with a medical cover which will be useful if an accident occurs.

    A third-party car insurance policy is the minimum requirement as per the Motor Vehicles Act, 1988. However, considering the value of a car, a comprehensive policy is the ideal protection plan for your car. It provides coverage for the damages caused due to accidents, theft, civil protests, riots, storm, volcano eruption, flood, burglary, etc. The premium for this plan is high as the coverage capacity is wider.

    It is given that the policy will be in the name of the owner of the car. However, you can always add your spouse or a legal heir to the policy to be covered in case of any future uncertainties. Recent studies have shown that the number of road accidents occurring every day is increasing all over the country, where usually victims are either driving a car or a two-wheeler, especially on highways. Driving on highways is risky as the number of trucks and lorries are higher and the speed limit is also more than 80 kmph. Therefore, the probability of accidents is also more than what you expect it to be. Death of a loved one caused due to a road accident or any other, is a painful incident that takes a lifetime to deal with. Hence, travelling safely and ensuring that you have a proper car or motor insurance policy is very important.

    Car insurance after death of the owner of the car:

    If your spouse or a loved one has suffered an unfortunate death in a car accident, a motor insurance policy is the last thing you would want to worry about amidst all the chaos. However, it is important to know the necessary steps that have to be taken during such an event.

    A car is also an asset with great value and emotions attached to it. So many families would want to keep the car rather than selling it. In such a case, here is all you need to know:

    1. When either of the spouse dies, and has a survivor:

    As mentioned above, most of the road accidents happen on city roads, especially during the peak hours. Everyone is in a hurry to reach the office and are often seen violating the traffic rules for the same. If your spouse also has met with an accident (even though he/she may be driving properly), then it is important that you inform the car insurance company soon after the incident. By informing the insurer;

      • The insurer will take care of the repair charges of the car without you having to worry about it, provided the policy is active.
      • All the towing charges, repair cost charged by the garage, and other car repair related issues will be looked after by the insurance company.
      • This will also give you peace of mind to look after other issues like life insurance claim settlements, and of course dealing with the trauma.

    If a spouse has listed the other spouse (husband/wife) as the ‘named insured’, which means that he/she is the legal heir of the car insurance policy, when the primary owner of the car dies, then all the policy documents are easily transferable. If such is not the case, then the successor will have to inform the insurer to rewrite the policy documents in the successor’s name by submitting the following documents:

    • Original death certificate copy of the deceased owner of the car
    • Form 30 and 31, if the car was purchased on loan
    • NOC from the financier, if any
    • Original Registration Certificate
    • Succession Certificate
    • Notarised affidavit mentioning the transfer of the insurance policy to the successor’s name
    • Original car insurance policy
    • Pollution Under Control (PUC) Certificate
    • Address and ID proofs
    • Marriage Certificate Copy
    • Form 20 duly filled and signed by you
    • Self-attested copy of PAN or Aadhaar

    The above-mentioned documents must be submitted to the insurer within 30 days of death of the owner of the car. Post this period, a late fee will be charged as per the number of days delayed for the same. Once the insurance transfer is complete, it is also important to transfer the vehicle Registration Certificate to the successor’s name so that he/she can drive the vehicle with proper documents. The documents required are:

    • Original RC
    • Pollution Under Control Certificate
    • Chassis imprint of the vehicle
    • Vehicle details and sales certificate
    • Valid car insurance policy
    • Death Certificate of the deceased person
    • Address and ID proofs of the successor
    • Attested copy of PAN or Aadhaar
    • Form 31 application for the transfer of the vehicle ownership to successor’s name
    • Succession Certificate
    • Form 29 and 30 duly filled and signed (as applicable)
    • Applicable transfer fee

    Submit the above documents to the RTO authority. Within a week or 10 days after the completion of the verification of the submitted documents, the ownership of the vehicle will be transferred to the successor’s name.

    2. The policyholder is a single parent:

    If the policyholder was a single parent with only children as his/her successors, then the children can inherit the car and the policy with above-mentioned list of documents. If there is more than one child, the sibling who decides to own the car will have to intimate the insurance company and the RTO for ownership and insurance transfer process within 30 days of the death of the parent. Also, the successor should check for the policy expiry date and pay the premium on time to avoid any complications in the transfer procedure.

    If there are no legal heirs of the car, then any blood relative of the deceased owner can transfer the car and all the related documents in his/her name and then if needed, the car can be sold.