Auto Insurance when buying a New Car

Auto Insurance when buying a New Car

Don’t get lost in that “New Car Smell” when purchasing a new vehicle. You need to make sure you have coverage for your vehicle, because you may or may not have automatic coverage for vehicles you purchase, depending on the situation!

When is Auto Insurance Coverage automatically extended to a new/used vehicle I purchase?

You have 30 days of automatic coverage IF:

  • You already have an Insurance Policy in place, AND
  • The name on the title for the new vehicle matches the name on the policy (NOT just a driver)

This is not FREE coverage, but Automatic coverage. This means you will be charged back to the date of the purchase of the new vehicle once it is added to your policy, but this allows for when you buy a vehicle on a weekend or don’t notify your insurance company before hand.

What level of coverage is automatically extended to my new/used vehicle I just purchased?

This varies by carrier, and you should check your policy to be sure, but typically the best coverage you have is what is extended to your new vehicle. If you have Liability only, that is what is extended. If you have comprehensive and collision, that is what is extended.

If you trade-in a vehicle, typically, the coverage that was on the vehicle you traded-in is what is extended to the new vehicle, but again this varies per carrier so please make sure to read through your policy documents.

When is coverage NOT automatically extended to a new/used vehicle I purchase?

There are a few situations when coverage will not be extended, but the most common reasons are:

  • You do not have any auto insurance before you purchased the vehicle.
  • You were listed as a driver, but not a named insured, on someone else’s policy (i.e. your parents) and you buy the vehicle in your own name.
  • You title the vehicle in another name than what your policy lists, i.e. a business name.

This is by no means an exhaustive list, and only the actual issued policy documents can dictate of when you have coverage.

So I am planning to buy a new/used car, what should I do?

While you may get automatic coverage, you still need to let your Agent know! Also, this might be a perfect time to shop your insurance policy around, so give us a call at (925)297-4202, or fill out the form on the right!


*The above blog post in no way implies or guarantees coverage. The only way to be sure about your coverage is to read through your policy and contact your carrier.

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All information is general in nature and is intended to provide guidance only. It is up to you to request specific coverage options, the agency and agent do not bear this responsibility. Always read the policy if there is a questions about coverage or a claim. If any information herein should conflict with your actual policy’s specific language, the policy language will be controlling.

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