According to the Act governing motor liability insurance, a motor liability insurance company licensed to issue policies cannot refuse to issue and keep in force a policy that has been applied for. In certain cases, however, the company may require the advance payment of the insurance premium for the first insurance period, pursuant to the terms and conditions of its motor liability insurance. In such a case, the insurance company's liability only begins when the insurance premium has been paid.
To take out insurance in someone else's name requires that person's authority: in practice this means a written power of attorney.
New motor liability insurance must be taken immediately when a vehicle has been procured or its keeper has changed, however no later than seven (7) days if the vehicle was bought from its registered owner. If the vehicle is uninsured at when it ownership or right of possession changes, the insurance must be taken out on the day of purchase.
The basic principle is that the policyholder takes out the insurance policy and, when doing so, ensures that the vehicle has valid motor liability insurance and that it has not been withdrawn from use.
The motor liability insurance policy held by the registered owner or keeper of the vehicle will compensate for any damage caused by the vehicle for seven days from the transfer of ownership unless the new owner or keeper has taken out motor liability insurance.