What you should know about getting insurance for your new car
So you’re considering a new car – now it’s time to get new car insurance. After striking a bargain at the dealer, getting all the discounts, rebates, and other incentives, you’re ready to sign the paperwork. Before you speed off the lot with your new wheels, you need to get some coverage. Here’s what you should know about insuring that new car.
Do You Have An Existing Policy In Place?
If you have an existing auto policy, then your new car should be automatically covered. The same coverage on your current policy usually extends to the new vehicle. Typically, you have 14-30 days to inform your insurance company about the new purchase – depending on your state and insurer. Call your insurance company in the first couple of weeks after buying the new car. That way you won’t drive uninsured – the sooner you call the better.
Bear in mind, your current coverage may not be the same coverage you need for the new car. For instance, if you don’t have comprehensive and collision on your current policy, it will not magically appear on the new vehicle. Also, if you’re financing the car, the bank usually requires comp and collision to cover the note. They’ll need a copy of the insurance binder describing your exact coverage before you take the keys.
But I Don’t Have a Current Auto Policy…
If you don’t have a current policy, you need to pick up some coverage. Most states require liability insurance. If that’s the case, your dealer will probably require a binder before you drive off the lot. In addition, you will probably need comp and collision if you’re financing the car. Your insurance company can provide a binder that shows both types of coverage.
Don’t wait until you’re at the dealer to get a new policy. Sign up for coverage before you buy the car. You can always post-date the coverage with your insurer – that way you’re not paying for insurance before you need it.
As always, we recommend getting several quotes before you get a new policy. Prices fluctuate and vary across the industry and by driver. To get multiple quotes from our online quote aggregator, go to…
Budgeting Insurance For Your New Car
A new car can be more expensive than you expect. Make sure you can afford the extra hundreds of dollars for the payment as well as the insurance for the new vehicle. Because it’s a newer car with more value, insurance tends to be higher. Also, if you buy a sports car, be prepared to pay a handsome sum to insure it.
Bottom line, budget for your new car. From payment, to gas mileage differences, to the extra cost for insurance – a new vehicle can be an expensive toy. Even still, it’s a fun toy.
Any thoughts about insuring a new car? Feel free to leave a comment.