How is insurance calculated for a transferred vehicle?
2 Answers
If the original insurance of the transferred vehicle has not expired, both the buyer and seller should bring the original insurance policy, vehicle registration certificate, and transfer invoice to the insurance company to submit the required documents. The insurance company will review the materials on the spot and issue an endorsement to complete the insurance transfer. There are two common methods for transferring insurance: 1. Apply for cancellation: The new owner cancels the original owner's vehicle insurance and then applies for a new insurance policy under the new owner's name. This method requires the original owner to personally visit the insurance company to cancel the policy. When the new owner reapplies for insurance, they need to present the new vehicle registration certificate and vehicle transfer certificate. This method is suitable for vehicles whose insurance is about to expire, and the insurance after the transfer will be calculated at a new price. 2. Modify the original policy information: Change the insured to the new owner. For this method, both parties must specify in the sales contract that the original owner will bring the policy and vehicle transfer certificate to the original insurance company to complete the process. If the new owner purchases a used car with long-term valid insurance, they can choose this method. The transferred insurance will be under the new owner's name until the policy expires, and the insurance will not be recalculated.
Last time I bought and sold a used car, I realized that transferring car insurance is quite important. The insurance doesn't automatically transfer with the car during the ownership change—the new owner needs to purchase a new policy. Insurance companies calculate premiums based on the new owner's details, such as age, driving record, and the car's year and model. Those with a clean driving history get lower premiums. Don't forget, it's best to arrange new insurance on the day of the transfer; otherwise, driving without insurance is illegal. Getting fined is the least of your worries—being uninsured in an accident is far worse. The previous owner can cancel the original policy and sometimes get a partial refund. I recommend the new owner contact insurance companies in advance to compare quotes and choose a suitable plan. From my experience, going with a reputable insurer helps keep premium fluctuations minimal.
