It is so exciting to get to shop for a new car! Before you can drive away in your new ride, you will have to prove to the dealer that you have car insurance - what does this mean for you? Do you need to get new insurance before you buy the car or can your old insurance roll over?
While the safest bet is to check with your insurance company before you buy a car, here are a few things to remember about auto insurance and how it transfers from your current vehicle to a new one.
If you have just purchased a new car and you are trying to figure out how much of your insurance has transferred over to it, don't worry, at least some of your insurance policy always does transfer over for at least a short "grace period" - usually about 30 days. This means that the coverage you had on your old car does cover your new car, at least at the very minimum levels. But since your new car probably has new features and may be more expensive than your old one, you will want to get your insurance up to date quickly to make sure you are fully covered.
One option is that your policy will transfer over to your new car exactly as it was for your old car. If you have minimum liability only insurance coverage - minimum insurance required by the law - then it will most likely carry over, with the same minimum liability only coverage for your new car. If your new car is financed, you will need to add more coverage to your policy as soon as possible to include collision and comprehensive coverage.
Certain coverage may become ineffective if you don't contact your insurance company within a specific period of time. Although some companies allow you less time to notify them about your new car. If you fail to notify your insurer within the proper amount of time, certain coverage may no longer protect you and your new vehicle. The amount of coverage you carry over after your grace period has elapsed may depend on whether you're replacing a vehicle in your household or simply adding another one.
Replacing your old car with a brand new one isn't just a great deal for you, it can also mean a great deal for your auto insurance. If you get a new car, most insurance companies will let comprehensive coverage will carry over during the grace period but run out after that period and leave you not covered for damages that may occur during an at fault accident or due to weather damage. This could leave you financially responsible to completely replace a car you just bought.
On the other hand, if you are adding an additional car to your family and you do not notify your insurance company immediately, none of the standard coverage will apply to that car. You have to notify the insurance company right away that you are getting another car.
Every insurance company has different restrictions involving replacement or additional vehicles, so make sure you discuss them with your insurance company if you have questions.
While the safest bet is to check with your insurance company before you buy a car, here are a few things to remember about auto insurance and how it transfers from your current vehicle to a new one.
If you have just purchased a new car and you are trying to figure out how much of your insurance has transferred over to it, don't worry, at least some of your insurance policy always does transfer over for at least a short "grace period" - usually about 30 days. This means that the coverage you had on your old car does cover your new car, at least at the very minimum levels. But since your new car probably has new features and may be more expensive than your old one, you will want to get your insurance up to date quickly to make sure you are fully covered.
One option is that your policy will transfer over to your new car exactly as it was for your old car. If you have minimum liability only insurance coverage - minimum insurance required by the law - then it will most likely carry over, with the same minimum liability only coverage for your new car. If your new car is financed, you will need to add more coverage to your policy as soon as possible to include collision and comprehensive coverage.
Certain coverage may become ineffective if you don't contact your insurance company within a specific period of time. Although some companies allow you less time to notify them about your new car. If you fail to notify your insurer within the proper amount of time, certain coverage may no longer protect you and your new vehicle. The amount of coverage you carry over after your grace period has elapsed may depend on whether you're replacing a vehicle in your household or simply adding another one.
Replacing your old car with a brand new one isn't just a great deal for you, it can also mean a great deal for your auto insurance. If you get a new car, most insurance companies will let comprehensive coverage will carry over during the grace period but run out after that period and leave you not covered for damages that may occur during an at fault accident or due to weather damage. This could leave you financially responsible to completely replace a car you just bought.
On the other hand, if you are adding an additional car to your family and you do not notify your insurance company immediately, none of the standard coverage will apply to that car. You have to notify the insurance company right away that you are getting another car.
Every insurance company has different restrictions involving replacement or additional vehicles, so make sure you discuss them with your insurance company if you have questions.
About the Author:
About the Author: Ashley Jones is an auto insurance advice columnist and blogger for Al Boenker Insurance based in Fort Worth, Texas. Jones provides expert insight into the car insurance industry to help Texans understand the logistics of their car insurance policies. Find out more about your Texas auto insurance coverage and learn more about how you can get the lowest rate on your Texas insurance at thanksal.com.
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