Admin | 04 Jul, 2025

Can You Sell A Car Without Insurance in India?

To begin with, it is mandatory to have valid insurance for your car. At least, a basic insurance cover is required for driving the car as well as selling it to another person. You cannot expect the buyer to purchase the car insurance cover before owning it, right? The motor vehicle act specifies the need for insurance. The defaulters will have to pay a hefty fine, which would be much higher than buying basic insurance at times.

Can a Car be Sold Without Valid Insurance in India?

People think of evading renewing car insurance due to the following reasons basically:

• To save some money
• To save time
• Missed out on renewing the insurance in time
• Not aware of the consequences
• Confident that nothing would happen to the vehicle

You are wrong if you are one of those thinking to save time and money by not renewing the insurance. With the latest provisions, you can renew the insurance online. Thus saving time. Nonetheless, the vehicle will have to be presented to the insurance agency in case the renewal date is over. The car insurance can be renewed only after inspection by the authorized person in that case.  

With the tight competition among the insurance companies, the insurance premium has come down phenomenally. You can switch to any insurance company without any complications. Yes, unlike before, the customer can now choose to change the insurance company.

The process is not complex even if you have missed out on renewing the car insurance in time. You can also request the insurance agent to reach your office, for completing the formalities.

Coming to the question, of whether cars can be sold without valid car insurance in India, the answer is no. It cannot be done in a straight or legal manner. However, there are people who might sell it to innocent customers, who may not be aware of the mandatory requirement.

Nevertheless, the car’s ownership cannot be transferred if it doesn’t have valid car insurance. The RTO would seek the insurance details for transferring the ownership. In effect, the car might remain in your name unless you produce valid insurance. Note that, you are liable to be answered for any accident, incident or crime happening in the vehicle during this period.

The Problems of Selling a Car without a Valid Insurance India

Let’s look into the problems that might occur when you sell a car without valid insurance in India.

• Vehicle ownership will remain with you even after selling the car. You are answerable and punishable for any issues related to the vehicle.
• It can lead to your imprisonment if any serious crimes happen in the car. Or the vehicle is used for illegal activities like smuggling. It will be too difficult to prove your innocence in court.
• You will have to pay the amount from your pocket if the car meets with an accident that causes damages to man and material.
• There’s a possibility of suspension of the driving license if the car without insurance is met with an accident.

Instead of avoiding renewing car insurance, you can consider opting for third party insurance. Third-party car insurance is cheaper than full coverage. But, it is a legally accepted form of insurance. Hence, you will have insurance without spending much. Nonetheless, the third-party insurance will not cover the damage to the car, the driver or the passengers. It will cover only the third party affected by the accident.

Sell your car with ease. We offer free RC transfer, the best price and instant payment. 

What are the Benefits of Car Insurance?

The government has made it compulsory to have valid insurance when you drive a car on road. Otherwise, you are not supposed to use it at all. Motor insurance offers several benefits as well.

• Enhances the confidence of the driver – Having valid vehicle insurance will make the driver more confident. The thought that she or he will not have to pay for the damages in case of a mishap makes the person bolder to drive the vehicle.
• Cover the damage caused due to the accident – The car owner might have to pay exorbitantly in case of man and material loss in an accident. The insurance company will pay the affected people if the car has valid insurance.
• Repair the car without spending from your pocket – A full-cover insurance will cover almost all the parts of the car. You may not have to pay much for repairing the vehicle and bringing it back to the condition before.
• Personal accident cover – The full cover insurance with personal insurance cover will help in medical treatment post an accident.
• Passenger insurance – You can also opt for passenger insurance, which would cover their treatment expenses as well. Adding the passenger insurance cover will not cost much.

Hope this article is helpful in clarifying the doubts about vehicle insurance in India. Indus Used Cars, being one the leading used car dealers in Kerala can assist you in case of any related doubts or queries.