How to properly re-register MTPL for a new owner in 2021: instructions

Is it even possible to re-register OSAGO for a new owner?

When concluding a transaction, be it a gift, purchase or sale, or transfer of a car by proxy, the alienator relieves himself of liability to the victim in the event of an insured event. As soon as the vehicle is transferred to the new owner, the MTPL agreement is no longer valid. Motor vehicle liability is assigned to the new owner, therefore, the policy must be reissued within 10 days.

Is it possible to re-issue MTPL for a car if the owner has changed? Among the possible options, there is one such as re-registration of the MTPL agreement from the old owner to the new one. By the way, insurers are much more willing to take this step, which cannot be said about the payment of compensation for early termination of the contract, which is provided for in Art. 10 clause 4 of the Law “On Compulsory Motor Liability Insurance”.

In what situations is it necessary to re-register compulsory motor liability insurance for the new owner of the car?

The new owner of the car will need MTPL insurance, which includes his name. It goes without saying that the old owner is not obliged to reissue the policy to another owner. However, the vehicle license will have to be redone in the following cases:

• alienation of a car under a contract of sale, gift, exchange, etc.;
• transfer of the vehicle under a general power of attorney.

There are several options for purchasing an MTPL agreement if the owner of the car has changed, namely:

• registration of a new MTPL policy after purchasing (receiving as a gift) a car;
• adding the name of the new owner to the current policy;
• re-registration of a car title to a new owner in order to use the remaining insurance period.

Good to know! Which of the above paths to take is decided by both parties, both the alienator and the acquirer. If contact between them is not established, and there is no possibility of reaching an agreement, then the newly minted owner remains to draw up a new contract. Not a single regulatory act regulates the procedure for re-issuing an MTPL agreement when selling a car, so the old owner is not obliged to meet halfway in this matter.

As for the previous owner, he, in turn, can also go in several ways:

• re-registration of the MTPL contract for another car - the policyholder can use the remaining insurance period by transferring it to another vehicle belonging to him. Rewriting OSAGO for another car is a convenient way if there is a double transaction when a motorist purchases a new car immediately after selling the old one;
• termination of the contract with the insurer ahead of schedule and receipt of the unused portion of the insurance premium. This makes sense if the motorist does not intend to buy another vehicle in the near future or is planning a move, after which it is not possible to maintain contractual relations with this insurer;
• entering information about the new owner into the insurance. This is practiced when transferring a vehicle under a general power of attorney, without drawing up a civil law contract.

The issue of renewing insurance for the new owner is discussed in advance. It is discussed at the request of the parties: either orally or documented. In this case, the decision remains between the old owner and the new owner of the car - the details of the re-registration can be covered in a separate clause in the property agreement (deed of sale, deed of gift, exchange) or stipulated in a separate written agreement concluded between the parties and certified by a notary (which is not a mandatory condition) .

In what cases will the insurance company refuse?

All legislative acts relating to compulsory insurance provide an explanation of the procedure for early termination of compulsory motor liability insurance, but they do not say a word about re-registration. This gives the insurer the right to act at its own discretion, so refusal to renew the insurance contract to another person is also possible.

However, insurance companies understand that in this matter it is better to meet the policyholder halfway for at least the following two reasons:

• a new car owner is a potential client who is less likely to want to buy compulsory motor insurance where he was refused to renew the contract. Consequently, the company loses the new owner of the vehicle as a client;
• if the insurer refuses, the old owner will most likely want to collect the remainder of the insurance premium for the unused period, which is completely legal and completely unprofitable for the insurer, and it will not be possible to refuse this either.

Therefore, large and rated insurance companies almost always willingly agree to reissue an existing contract, since they understand that this is the most, if not profitable, then the optimal scenario for the development of events. Refusal may come from small firms citing the individual characteristics of running an insurance business that do not allow doing otherwise.

However, sometimes the refusal is quite justified. For example:

• the insurance history of the new owner leaves much to be desired - the coefficients are too high, so the insurance company does not agree to re-register;
• the previous owner caused the accident during the current insurance period. In this case, the insurer almost always refuses to re-register.

In case of refusal, the old owner has no choice but to terminate the contract and receive payment for unused insurance, and the new owner must enter into a new contract with the selected insurance company.

Cost of adding another driver

The price is calculated using the following formula:

(basic cost of the document + KBM + cost of the policy taking into account the discount) × period of registration of the policy

It turns out that there is no single cost; it depends on many factors. From which ones exactly?

What affects the price?

The price tag depends on:

1. The basic cost of the insurance document.
2. Territorial coefficient (according to OSAGO statistics).
3. KBM of the new driver.
4. SWR (age-experience ratio).
5. How long does the driver sign up for?

Age to experience ratios:

1. 8. The driver of the vehicle is under 22 years of age, and his driving experience does not exceed three years.
2. 7. The driver of the car is already more than 22 years old, but his driving experience is still short (less than three years).
3. 6. The driver is over 22 years old and has more than three years of driving experience.

Many insurance companies provide a system of discounts of 5% or more. This system is cumulative and depends on the number of “accident-free” years.

Step-by-step instructions for re-registration

The procedure for reissuing a policy is the same, however, in each case there are features that depend on which path the alienator and the acquirer choose.

Step one

Preliminary resolution of financial issues. The old owner paid for the entire insurance period, so it is quite natural that he wants to get his money back. If the previous owner wants compensation for unused insurance, and the potential buyer agrees to its terms, he has several options:

• include this amount in the cost of the car;
• receive it from the new owner upon re-registration.

Often, compared to the amount received from the sale of a car, this figure does not seem significant, and this issue is simply not raised.

Step two

Preparation for re-registration of compulsory motor liability insurance at the conclusion of the transaction. The issue of re-issuing an insurance contract must be discussed at this stage. If the car is transferred under a general power of attorney, the new owner can be included in the policy, but if it is a deed of sale, this option will not work - you will have to issue a duplicate policy for the new person.

These points are discussed orally, or recorded on paper if both parties are interested in this. The issue of re-registration of compulsory motor liability insurance can be considered as a separate clause of the property agreement, or a separate document can be drawn up, where the subject of the agreement will be the motor vehicle title.

Step three

Collection of documents. The seller will need a policy and an application for renewal. The buyer must provide a complete package of documents:

• passport;
• property agreement;
• PTS with the latest information;
• driver's licenses of the new owner and all authorized persons.

If we are talking about a legal entity, then you will need to provide a full package of statutory and registration documents to the company to which the car was transferred.

Step four

Visit to SK. The seller and buyer must visit the insurance company together. If the new owner cannot come to the office in person, he can transfer all the listed documents through the previous owner, whose presence is required. This is a common practice when a deal is concluded between good friends.

Step five

The final stage of re-registration. At the end of the procedure, the new owner receives a duplicate of the insurance policy. The old one must be destroyed. In addition, he is given a copy of the receipt for payment of the insurance premium, two copies of the European protocol and the insurance rules.

Is there a need to reissue the policy?

First of all, it is necessary to understand the true purpose of insurance.

The policy is mandatory for all drivers and insures their civil liability, that is, it is issued not for the car, but directly for its owner.

When driving a vehicle is carried out not only by the owner of the car, then all citizens who have access to the control must be included in the insurance. Also, it can be unlimited, then any drivers can be allowed to drive. The difference between such insurance will be its higher cost.

It follows that when selling a vehicle, its previous owner must contact the insurer to make all the required changes.

The same applies to the buyer, that is, the new owner of the car. Since the details will be changed, he will need to meet with the insurance agent.

The need to perform these actions is prescribed in legislative acts. And it informs citizens that the owner of the car is obliged to notify the company with which the insurance contract is concluded about any changes, including a change of owner.

Now it’s worth figuring out what is the best way to reissue the policy to the new owner.

Features of recalculation during re-registration

Unfortunately, the specifics of calculating the insurance premium in this case, as well as the re-registration procedure itself, are not covered in any regulatory act. Therefore, insurers act at their own discretion and recalculate only upward. So the new owner:

• or pays the missing amount if his insurance history is worse than that of the former owner;
• or does not take any steps, even if his history is better than that of the alienator.

On a note! Insurers are always reluctant to part with an insurance premium, even considering that the procedure for early termination of a contract is regulated by law. Therefore, in matters of recalculating insurance downwards during re-registration, they are, as a rule, unshakable.

Important Tips

• it is impossible to resolve the issue of re-registration remotely - it is best to visit the main office and rewrite the policy to the new owner there;
• if the old owner wants to renew the contract for a new one and at the same time receive compensation for unused insurance, then the best option would be to include this amount in the cost of the car and not discuss this issue separately;
• the insurance company must be notified within three days of receiving new license plates after re-registration of insurance;
• A duplicate policy is usually issued free of charge, but some insurers insist on additional payment - on average 400-600 rubles.

What should you do with your MTPL policy when there is a change of owner?

If the owner of the car changes - for example, when it is sold - the old OSAGO contract issued for it must be terminated. Only after this the new owner will be able to issue a policy in his name. Only one policy can be issued for one car, so it is important to follow the order - first cancel the old one, then buy a new one..

As in the case of buying a car at a dealership, the new owner is given 10 days to obtain compulsory motor liability insurance. Without a policy, you will not be able to register your car and risk getting a fine. Therefore, you should not delay re-issuing insurance - the sooner you resolve the issue with the previous owner’s policy, the sooner you will start using the new car.