Laws laid down by supreme court

TRANSFER OF VEHICLE POLICY WITH SALE OF VEHICLE

INSURABLE INTEREST WHEN GETS TRANSFERRED TO NEW OWNER OF VEHICLE 

Under the insurance policy the benefits do not ‘perse’ transferred to the new buyer. The original owner seizes all the benefits of the insurance policy the day he sells his vehicle to the new buyer. Mere intimation from the side of new buyer or through broker/dealer regarding sale of the vehicle and transfer of the insurance policy in favour of the new buyer is not sufficient. The new buyer is expected to make formal request for transfer of the policy in his favour and a fresh agreement is to be executed between the insurer and the new owner after pay-ment of the requisite fee. The new owner/purchaser has to apply in writing within a period of 14 days from the date of transfer to the insurer. General Regulation 17 of Indian Motor Tariff Act provides that a fresh proposal form duly com-pleted is to be obtained from the transferee. Transfer of package policy in the name of the transferee can be done only on getting the acceptable evidence of sale and fresh proposal from duly filled and signed. The old certificate of the insurance for the vehicle is required to be sur-rendered and a fee of Rs.50/- is to be collected for issue of fresh certificate in the name of the transferee.

 Relying on the above regulation, State Commission, Delhi in First Appeal No. 90/2011 of Na-tional Insurance Co. Ltd. Vs. Shobit Goel set aside the order of District Forum-II, New Delhi in complaint case No. 597/2008. District Forum earlier passed the order directing insurance com-pany to pay Rs.35,000/- towards cost of the CNG kit missing from the vehicle on theft and Rs.15,000/- as compensation.


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