Car Insurance Grace Period for Used Cars

While having a car can add a lot of convenience to your life, it can also add to your expenses. Unfortunately, new cars go down in value the second you drive away from the car dealer. This is why choosing to buy a pre-owned or “used” car can be a practical — and affordable — solution. However, to drive any car in the U.S., you have to have proof of insurance.

Insurance coverage is important because it keeps you safe behind the wheel, whether you’re in a new vehicle or not. Buying a car can be pricey, but your premium doesn’t have to be. Insurify is here to help you compare car insurance quotes to make sure you’re driving with the protection you need. Insurify does all the work to make ensure you score cheap insurance rates.

You always need auto insurance

Almost every state (except New Hampshire, where you only need to show proof of financial responsibility) requires you to have an auto insurance policy if you decide to operate a vehicle. While it varies from state to state, at the very minimum, drivers should have liability coverage, which protects them from paying for bodily injury or property damage expenses out of pocket.

Depending on what state you live in, you might even need a policy before you can register your car at the department of motor vehicles (DMV). Registration is a way to keep track of cars on the road, report stolen vehicles, and more. It varies on a state-by-state basis, so check with your state’s DMV guidelines because some drivers can register their car without having a policy.

In addition to saving you money, buying a used car can be an attractive option for some people because it allows you to do business with a private seller instead of potentially overpriced car dealerships. For example, getting a car from your next-door neighbor for a deal probably seems better. However, they might not ask you if you have a policy, and you can drive away uninsured.

So what happens when you make a car purchase, and what does it mean for when you need to buy car insurance? It doesn’t really matter if it’s a new or old car. What matters most is if it’s your first car and whether you already have a pre-existing car insurance policy. From there, it can be easier to determine the period of time you can wait until you get a policy.

How long you can wait to insure your used car

At the end of the day, you will need insurance to drive your used car, so it’s probably best to just bite the bullet and not wait. However, we know this isn’t an option for everyone. At a glance, here’s what you need to know about how long you can go without auto insurance coverage and the types you need if you decide to get a car, regardless of whether it’s a used vehicle:

In most cases, car insurance companies will offer a seven- to 30-day grace period if you are replacing an old car with a new one and already have a pre-existing policy. Each state has its own laws, so be sure to speak with an insurance agent for more information. Requirements vary depending on whether you are replacing or adding another vehicle to your policy:

• If you are buying a used car as your second vehicle, you just need to add it to your current policy and you can drive with coverage — and without any lapses.

• If you are replacing a car on your policy, talk to your insurance company about grace periods. In most cases, your existing policy will cover your car for a short amount of time, providing you with temporary coverage when you buy your used car.

If you do not already have coverage, you will need to get a new policy before buying a used car. Getting a new car insurance policy will probably be the case if it’s your first car or if you cancel your policy prior to getting another car.

You do not need to have insurance for your car until you are the owner. So, if you are planning to buy a car in six months, you do not need to worry about buying a policy immediately. But you should have one by the time of your purchase. Know that if you plan to drive your car home from the dealership, you will need to have coverage.

Even though car insurance coverage is required in almost all U.S. states, buying full coverage isn’t necessary. At a minimum, you should consider liability insurance, which protects you from paying for bodily injury and property damage, and collision coverage, which pays for car repairs if it gets damaged in an accident.

What to talk to your car insurance company about

Now that you know you need to have an insurance policy and all the other details on how long you can wait to insure your used car, there are a few things you might want to consider bringing up with your car insurance provider. Whether or not you are starting a new policy or continuing a pre-existing one, there are some details that can be helpful when insuring your used car.

How to get proof of insurance before buying a car

If you don’t already have an insurance policy and need to buy a new one: Let your insurance company know details like the vehicle identification number (VIN) if you know which car you plan on buying. Also, consider running a VIN check to review the used car’s history and whether it’s been reported in any theft. This is the safest way to ensure your purchase is valid.

If you already have an insurance policy: If you’re replacing a car on your policy, be sure to ask your insurer about your grace period and show your insurance card at the dealership. Maybe this used car is for your new teen driver because you don’t want to risk buying a brand-new one. If you’re adding a second car to your policy, you can still just show your card.

Do your own research before buying

If you buy your used car from a dealership, a sales representative may try to sell you a policy on the spot because they know you need to have one before you start driving. Know that you don’t need full coverage, so consider doing your own research on car insurance companies and the coverage you need so that you can save from potentially overpriced policies at the dealership.

Insurify is the best way to compare hundreds of insurers to make sure you’re getting the best deal that fits your needs. You can start with the minimum coverage and then consider optional add-ons like comprehensive coverage. Progressive, Allstate, GEICO, and State Farm are all big brand names, but you can get quality policies from other insurers you may have never heard of.

Also, always be sure to look up your state’s insurance laws. For more information, you can talk to an insurance agent, someone at the DMV, or anyone else with expertise in insurance work.

The takeaway: Used cars still need to be insured

All in all, buying a used car is an affordable option to get transportation, but know that you will need insurance coverage to drive it. If you don’t already have a policy, you will need to get a new policy before you make the purchase. If you do have one, see if you can add the used car as a second vehicle or replace your old car and get temporary coverage through a grace period.

A great way to beat overpriced policies at the dealership is by doing research to compare rates to make sure you get the best deal. On top of looking up used cars, the last thing you want to do is more research. Thankfully, Insurify does all the hard work to help you find quotes that fit your needs, lifestyle, and budget. Quality coverage shouldn’t break the bank.