What Happens to Car Insurance Policy After the Death of the Policyholder?

Life is unpredictable. Anything good or bad can happen any time irrespective of whether someone is watching TV at home or driving a car. Fortunately, we have car insurance to take care of any unforeseen damages to our four wheelers that may lead to financial losses, including third party liabilities. Besides, car insurance is a legal mandate for all four wheelers plying on public roads. That’s how important motor insurance is and thus, everyone should compare car insurance plans before buying the most suited plan for themselves.

Car insurance comes to the aid of a person when his/ her car is involved in an emergency. But what happens to the car insurance policy in case of an untimely death of the policyholder. Does the policy continues or ceases to exist? This article explains everything that the family members of the deceased policyholder should do when it comes to car insurance.

What Happens to Car Insurance Policy After the Death of the Policyholder?

When a person dies, all his/ her assets are transferred to his/ her legal heir. This means that the car of the deceased person is also legally transferred to his/ her heir, who becomes its new owner. As a consequence, the car insurance policy also needs to be transferred to the name of the legal heir, provided the policy is still valid.

Whenever there is a change in the ownership of a car, its insurance policy also needs to be transferred to the new owner of the vehicle. With the demise of the policyholder, the ownership of the car gets transferred to the legal heir and thus, the car insurance also needs to be transferred to the latter’s name.

However, car insurance can be transferred only if the policy is still valid. In case the policy was already expired at the time of the policyholder’s death, even the best car insurance companies in India will not transfer it to the legal heir. In such a case, the heir will have to buy a fresh four wheeler insurance policy.

The policyholder might have also specified a nominee at the time of buying car insurance. In case the nominee and the legal heir are two different people, the policy will be transferred to the nominee’s name after the policyholder’s death. In the absence of a nominee, the policy will be transferred to the legal heir.

The death of a person is an extremely difficult time for the family. However, the days following the person’s death is a crucial time to complete a few important legal paperwork, including the transfer of car insurance policy. Thus, the legal heir should get the car insurance policy transferred from the deceased’s name to his/ her name at the earliest. But first, he/ she should inform the motor insurance company about his intention of transferring the policy to his name due to the policyholder’s death. He/ she will also have to submit certain documents to substantiate the transfer process.

In case the car insurance policy gets expired after the policyholder’s death and the heir is unable to get the policy transferred before the expiry date, he/ she can get the policy renewed in his/ her name. The heir can either renew the same policy or compare car insurance plans to find a more suitable policy.

People Involved in Transferring Car Insurance Policy After Policyholder’s Death

Generally, when someone buys car insurance, only two people or entities are involved in the process - the car owner and the motor insurance company. In case the policy has been purchased through an insurance agent or a car dealer, they become the facilitator.

But in case of the death of the policyholder, a different set of people or entities are involved in transferring the car insurance policy. To be precise, three people/ entities are involved during the transfer of car insurance policy after the death of the policyholder. They are:

    • Legal Heir/ Nominee

      The first entity involved is the legal heir/ nominee of the deceased policyholder. If the policyholder had made a nominee while buying car insurance, the nominee will be eligible for the policy transfer after his/ her death. In case no nominee had been specified by the policyholder, his/ her legal heir will be eligible to get the car insurance policy transferred to his/ her name.

    • Motor Insurance Provider

      The next entity involved is the motor insurance company offering protection to the deceased person’s car. The insurer must be informed about the death of the policyholder at the earliest. This will help them to change the policy details at their end and offer a new policy document to the legal heir upon policy transfer.

    • Regional Transport Office (RTO)

      The last person involved is the Regional Transport Office (RTO) where the deceased person’s car has been registered. To apply for car insurance policy transfer, the legal heir will have to get the Registration Certificate (RC) of the deceased policyholder’s car transferred to his/ her own name. This is because motor insurer needs a copy of the new RC, with the legal heir’s name, as a proof of transfer of the car ownership and will only then transfer the car insurance to the heir’s name.

Read More: Money Saving Advice for All Car Owners

Documents Required to Transfer RC After the Car Owner’s Death:

The legal heir will need to submit the following documents to the RTO to get the deceased person’s car transferred to his/ her name:

  • Filled-in Form 31 of the RTO
  • Original RC of the car
  • Death certificate of the original car owner
  • Chassis imprint of the car
  • Pollution Under Control (PUC) Certificate
  • Details of the car and its sales certificate
  • A valid car insurance policy
  • No Objection Certificate (NOC) from the bank (in case of an ongoing car loan)
  • Identity and address proof of the legal heir
  • Succession certificate
  • Attested copy of Aadhaar card or PAN Card
  • Transfer fee
  • Filled in Form 29 and Form 30 (if required)

Who Becomes the Legal Heir for Car Insurance Transfer After Policyholder’s Death As per Natural Succession?

As per natural succession, different people become legal heir for car insurance policy transfer based on the relationship of the deceased policyholder. Take a look:

    • If the Deceased Policyholder Has a Spouse:

      In case the deceased policyholder has a spouse, he/she will become the legal heir for transferring car insurance policy as per natural succession. Most people specify the name of their spouse as the nominee in the car insurance policy. The policy transfer process is easier if the legal heir and the nominee are the same. All the best car insurance companies in India provide the nominee details to the legal heir of the deceased policyholder when enquired.

    • If the Deceased Policyholder Was a Single Parent:

      In case the deceased policyholder was a single parent, his/ her child would become the legal heir for transferring car insurance policy as per natural succession. If the policyholder is survived by more than one child, the legal heir as per his/ her will or other processes will be eligible for car insurance policy transfer. Moreover, if one of the children is specified as a nominee, he/she will be eligible for policy transfer.

Read More: Secrets That Your Motor Insurance Provider Won’t Tell You

Documents Required to Transfer Car Insurance After Policyholder’s Death

The legal heir of the deceased policyholder will have to submit the following documents at the time of applying for transfer of car insurance policy:

  • Death certificate of the policyholder
  • Original car insurance policy document
  • Original RC of the car
  • Duly filled in RTO forms for policy transfer
  • NOC from the bank (in case of an ongoing car loan)
  • PUC Certificate of the car
  • Succession certificate
  • Notarized affidavit stating the car insurance policy to be transferred to legal heir’s name
  • Self-attested copy of Aadhaar Card or PAN Card
  • Copy of Marriage Certificate (in case the spouse is the legal heir)

Things to Remember While Transferring Car Insurance After Policyholder’s Death

There are a few things that should be kept in mind while transferring the car insurance policy to the legal heir’s name after the death of the policyholder. Take a look:

  • Make sure to determine the legal heir of the policyholder without any conflict
  • Contact the RTO where the deceased person’s car has been registered as soon as possible
  • Remember to contact the motor insurance company for a policy transfer as soon as possible
  • Keep all the required documents handy
  • Take the help of a lawyer if required
  • Don’t drive the car if the policy has expired
  • In case of policy renewal or buying fresh four wheeler insurance, compare car insurance plans before making a decision

Summing It Up

Death of a family member is unimaginable and everyone has the right to mourn. The legal heir of the deceased person should complete all formalities for transfer of the latter’s car insurance policy as soon as he/ she feels ready. The policy transfer process is pretty simple and can be easily done. Just make sure to not use the car without getting the policy transferred to avoid any trouble.

Written By: PolicyBazaar - Updated: 20 September 2020
You May Also Like
  • Best Car Insurance Companies in India

    Best Car Insurance Companies in India Getting motor insurance is essential for all the car/vehicle owners and drivers in India. It is mandatory to have third party car insurance in India under the Motor Vehicle Act, ...

    read more
  • Insured Declared Value (IDV)

    Insured Declared Value (IDV) Insured Declared Value (IDV) is the maximum Sum Assured fixed by the insurer which is provided on theft or total loss of vehicle. Basically, IDV is the current market value of the vehicle....

    read more
  • Zero Depreciation Car Insurance

    Zero Depreciation Car Insurance In a zero depreciation policy the insured gets the total cost of the damage or loss that is caused to the insured car. The depreciation value of the replaced or damaged parts is usually...

    read more
  • No Claim Bonus (NCB) in Car Insurance

    No Claim Bonus (NCB) in Car Insurance No Claim Bonus (NCB) is a reward, given by an insurer to a policyholder for making no claims during the policy term. No Claim Bonus can be accumulated as a discount on the premium...

    read more
  • 9 Secrets That Your Motor Insurance Provider Won’t Tell You

    9 Secrets That Your Motor Insurance Provider Won’t Tell You Due to the dangerous driving conditions, it is compulsory to have third party insurance for every vehicle plying on Indian roads. It ensures the overall sa...

    read more
Search
Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.
Calculate your car IDV
IDV of your vehicle
Calculate IDV
Calculate Again

Note: This is your car’s recommended IDV as per IRDAI’s depreciation guidelines.asdfsad However, insurance companies allow you to modify this IDV within a certain range (this range varies from insurer to insurer). Higher the IDV, higher the premium you pay.Read More

Policybazaar lets you compare premium prices from 20+ Insurers!
Compare Prices