Cancel Your Bike Registration Certificate After Scrapping

In the most severe situations of accidents, where the bike is entirely wrecked, the owners often sell the wreckage to scrap merchants without remembering to cancel their RC. Fraudsters forge the chassis number and engine number on documents relating to such cars in order to give stolen vehicles a new identity.

The owner of a wrecked vehicle that has been declared a Total Loss (TL) is responsible for having the Certificate of Registration (RC) revoked, according to Section 55 of the Motor Vehicle Act 1988. The owner must notify the registering authorities within 14 days of the vehicle's total loss for this reason. The registration will thereafter be cancelled by the registering authorities.

Why You Have to Cancel Your Bike Registration Certificate In Case Of Total Loss?

In case of total loss for your bike, you should cancel your bike registration certificate. Here’s how and why:

• What Is Total Loss?

The entire loss of a bike under a bike insurance policy refers to a circumstance in which the cost of repairing a bike exceeds 75% of the insured declared value (IDV) or the insured cost of the bike. The insured stated value is the maximum amount a bike insurance policyholder may claim for damage or loss of the bike from the insurance company. As a result, if the insurance company is required to pay more than the IDV, it is deemed a total loss.

In third-party responsibility, the idea of a total loss of a bike does not apply. As the maximum amount of claim under the comprehensive auto insurance policy, the insurer will only pay the IDV for damage caused by a natural catastrophe, fire, or accident. If the cost of repairs exceeds 100 per cent of the IDV, the bike will be declared a total loss. For the replacement of your bike, your insurance will pay the entire insured stated value as the claim amount.

• What To Do For Total Loss?

You can sell the remaining pieces of your bike to a scrap dealer if your bike insurer considers it a total loss. The remaining pieces of your bike will be broken down and recycled by the scrap dealer. If you do so, you'll have to turn off your bike's RC as well. It is the obligation of the bike owner to revoke the registration certificate of the bike after scrapping it when the insurer declares it a total loss, according to Section 55 of the Motor Vehicle Act of 1988.

The bike owner must report the entire loss to the Regional Transport Office within 14 days. The RTO will then cancel the bike's RC. Then your bike will be nothing more than scrap metal, and the RC will be unregistered. When the RTO receives a clearance report from the police, the RC will be cancelled. Within 4-5 weeks of the cancellation, the RTO will issue a non-use certificate for the bike. Depending on the state, the restrictions and cancellation costs will differ.

• Risk of Misuse Of Bike Documents That Have Been Damaged

If the bike is entirely damaged in a road accident or due to a natural disaster, and the insurance company deems it a total loss, it is critical to cancel the RC for that bike. If the RC of the dismantled bike is not cancelled, fraudsters and criminals might make use of the bike's documentation. They can take the paperwork from your trashed bike to provide a stolen bike or one that has been involved in any illicit activity a new identity.

• Cancelling RC To Minimise Risk Of Threat

Criminals see selling your bike to a junk dealer without cancelling the registration certificate as an opportunity. When a bike is stolen, the criminal tries to hide it in plain sight. They use your RC, engine number, and chassis number to change the identification of the stolen bike, then replace it with the one they stole. However, if you cancel the RC, these activities would come to a stop.

Endnotes

Last but not least, understand the idea of "total car loss." When filing a total loss claim, keep in mind that your car will only be classified as a "total loss" if the repair costs exceed 75% of the IDV. This is the maximum amount that a motor insurance company can claim for any damages sustained as a result of an accident.

This is to protect you against fraudulent activities involving the usage of your damaged auto parts. To avoid facing criminal charges or other serious repercussions, be sure you follow this process to the letter.

Also Read:

Bike Insurance Misconceptions to Be Ignored

Things To Do If Your Bike Insurance Policy Document Gets Lost

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.