What happens to bike insurance when the policyholder dies?

You must have secured your bike with third-party liability bike insurance or comprehensive two-wheeler insurance knowing how important it is. But have you ever thought about what happens to long-term two-wheeler insurance if the policyholder dies? Does the policy lapse, or is it transferred? Read on to know the answer.

Transfer of ownership

If the policyholder dies due to any reason, the ownership of the deceased’s bike is transferred to the name of the legal heir. Similarly, if the two-wheeler in question has active bike insurance, it must also be transferred to the legal heir.

However, if the policy has expired, legal heirs are provided with two options—to renew the existing policy in their name or purchase a new one. 

If the legal heir wants to transfer the policy, they need to inform the concerned insurer at the earliest. They must also check the list of essential documents that are required at the time of ownership transfer. 

Parties involved in the transfer of two-wheeler insurance 

Usually, there are only two parties involved in the two-wheeler insurance contract. However, other parties also get involved when it comes to the policy transfer due to the owner’s death.

Bike insurance provider

One needs to inform the insurer of the policyholder’s death at the earliest. The insurer will alter the details and information on the policy document accordingly. Once the details are updated, the insurer will issue the new policy document to the legal heir. 

Legal heir/nominee

Suppose the nominee’s name on the policy was added or altered during the deceased policyholder’s tenure. In that case, without much formality, the concerned insurer transfers the policy in the name of the legal heir. However, if the nominee’s name is not provided, the detailed transfer procedure must be followed.

Regional Transport Office 

Before the two-wheeler insurance transfer, legal heirs need to visit the RTO office to get the Registration Certificate (RC) transferred to their name. Transferring RC is important since it safeguards you from any legal consequences. If the bike in question is purchased on loan, then while transferring RC, the RTO will require a No Objection Certificate (NOC) from the financial institution.

Some of the other key documents that are necessary for RC transfer are:

• Registration Certificate
• Pollution Under Control certificate
• Bike’s chassis number 
• Bike insurance papers
• No Objection Certificate (if there is an active bike loan)
• Copy of death certificate
• Sales invoice 
• Legal heir’s KYC documents
• Certificate of succession
• Form 31
• Form 29 and 30 (if applicable)

List of documents that are essential for long term two-wheeler insurance transfer:

• Copy of Registration Certificate (RC)
• Policyholder’s death certificate
• Policy document
• RTO forms
• Copy of Pollution Under Control certificate

• NOC from the lender
• Copy of succession certificate 
• Self-attested copy of identity proof
• If the ownership is transferred to the deceased policyholder’s spouse, then the marriage certificate 
• Affidavit stating insurance transfer

Things to remember while transferring long term two-wheeler insurance post policyholder’s death

• Mutually decide on the legal heir to avoid any conflict of interest.
• After the policyholder’s death, the legal heir should immediately contact the insurer for alteration of details in the policy. 
• Contact the Regional Transfer Office (RTO) to complete the transfer process.
• Check all the essential required documents.
• Avoid riding with a lapsed policy.
• If you are facing difficulty transferring your policy, take the help of a lawyer. 

To sum it up

If you are using the bike of a deceased owner, make sure you undergo all the above formalities. Transferring the two-wheeler insurance is a simple process, provided that you have all the essential documents handy.

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source https://nrinews24x7.com/what-happens-to-bike-insurance-when-the-policyholder-dies/

March 24, 2022