Car Insurance Policy Doesn’t Expire Even If It’s Not Transferred Into Buyer’s Name | Bombay News

Jehangir Gai
Sheela bought a used motorcycle for his son from Mahesh. The insurance policy for this vehicle had been taken out by Mahesh from Liberty General Insurance, and was valid from September 27, 2016 to September 26, 2017.
The vehicle registration certificate was transferred to Sheela on April 27, 2017, but the insurance policy continued in Mahesh’s name.
The vehicle was stolen on June 2, 2017. A FIR was filed with the police the next day, while the insurer was intimidated on June 8, 2017. Sheela’s claim was dismissed on the grounds that the policy was not transferred to her name within 14 days of the transfer of the vehicle.
Sheela and Mahesh filed a joint complaint with the Neighborhood Forum request an instruction to settle the complaint. The insurer argued that Mahesh was not entitled to claim the loss because he had no insurance interest after selling the vehicle, while Sheela was not entitled to make a claim because the police had not been transferred to his name.
The Forum estimated that the insured value of Rs.1,37,824 should be paid with 12% interest from the date of theft until the date of payment.
In addition, 10,000 rupees were awarded as damages and 5,000 rupees for legal costs. The insurer challenged the order, but its appeal was dismissed by the Karnataka State Commission.
The insurer then filed a motion for review. The National Commission observed that there was no evidence to show that the policy would lapse if it was not transferred to the buyer within 14 days of the transfer of the registration certificate. She observed that after accepting the premium and covering the risk, the insurer’s argument that neither the original owner nor the buyer had the right to make a claim would be unacceptable and paradoxical.
Accordingly, by its June 3, 2022 Order issued by Dinesh Singh and Judge Karuna Nand Bajpayee, the National Commission dismissed the review and upheld the direction to settle Sheela’s claim.
The author is a consumer activist and won the Govt. Indian National Youth Award for Consumer Protection. His email is


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Justin D. O'Neill