Wondering how to insure your new car? The truth is, your current insurance policy will cover your new car the second you drive it off the lot—typically at the same level of coverage as your old car. But if you don’t carry liability or physical damage protection, you may end up stuck at the dealership, or worse, in violation of the law.
How does insurance work when buying a new car?
You don’t have to switch your insurance to your new car right off the bat. Since most insurers offer a grace period for updating your policy with your new vehicle, your dealer will typically just need proof of insurance before they throw you the keys. Even if you don’t have auto insurance, you can start a policy before buying your car if you know the vehicle identification number.
How much is insurance for a new car?
Usually, getting a new car will increase your rate because it’ll be worth more than your old car. But the exact difference in cost will vary greatly based on the:
- Model year
- Make and model
- Title and damage history
- Amount of coverage purchased
Note that other factors may impact your rate if you’re starting a brand-new policy. But even if your rate increases, you may be eligible for a few discounts, including the smart vehicle discount for automatic emergency braking (AEB).*Disclaimer Just get a quote online or call, and we’ll show you which discounts you qualify for.
Am I covered by dealer insurance?
No. Dealer insurance will normally cover test drives, but it won’t protect you once you buy the car.
Insurance requirements for purchasing a new car?
Financed vehicle
Required coverages: Comprehensive and collision coverage are usually mandated by the financer. Your state will also require some minimum amount of liability coverage to pay for any injuries or damages you cause if you’re at fault in an accident.
Other coverage options: You may also want loan/lease payoff coverage, also known as gap insurance. Loan/lease payoff coverage will pay the difference between what you owe on the vehicle and the actual value of your car if it’s totaled.
Leased vehicle
Required coverages: Comprehensive and collision coverages are usually required by the leasing company, and they may not allow you to choose a deductible over $1,000. You’ll likely also need a higher liability coverage amount, typically at $100,000 per person and $300,000 per accident.
Other coverage options: Consider loan/lease payoff coverage in case you total your car before your lease ends. Some lease agreements may already include gap insurance, so check before you add it to your auto policy.
Owned vehicle (no lender or lienholder)
Required coverages: You only need what your state requires — typically a minimal amount of liability coverage.
Other coverage options: Consider adding comprehensive and collision on your paid-off vehicle. If you don’t have physical damage coverage and your new car is stolen, vandalized, or damaged in an accident, you won’t get any money from your insurer.
For your convenience, we’re available to add your new car to your existing policy or get you started if you’re a new customer.
How long do I have to add a new car to my insurance policy?
When buying a new car, your insurance carrier will provide a grace period between seven to 30 days to update your policy with your new ride. For example, Progressive allows 30 days, which means if you have a claim within that period, your new car is still covered in the same way your previous vehicle was.
Can you send proof to the dealership?
Yes! We’re available to send proof of insurance to the dealership so you can drive off the lot in your new car. Having proof of insurance is important because most dealerships won’t let you drive away without it (often, your current insurance will be good enough).
What if I don’t have my lienholder information?
Ask your salesperson at the dealership. They’ll almost always have the information you’ll need. If not, no worries—we won’t need it to start immediate coverage. But, you’ll need to provide the lienholder’s name and address within two to three days of purchasing the policy or adding the new car to your existing one.
Do you offer new car replacement if I total my car right away?
Under your collision coverage, you’ll be covered for the fair market value of the vehicle. If you owe more than the vehicle is worth, you may want to purchase gap insurance (also called loan/lease payoff coverage), which will help pay the difference between the car’s worth and what you owe on your loan.
Tips for buying insurance for a new car?
- Know your VIN: Having your Vehicle Identification Number handy will help speed up the quoting process, and you won’t be able to purchase a policy without it.
- Tell us what you use it for: You may need additional coverage if you use your car for ridesharing or business errands.
- Add regular drivers: If family members will be driving your new car regularly, make sure to list them on your policy.
How to switch insurance to your new car?
New Toro Insurance Group customers
If you’re currently insured with another agency, you can simply start a new policy with your new car. Get a car insurance quote online or call us at 602-345-0360.
Current Toro Insurance Group customers
You won’t need to start a new policy. You can transfer your insurance or coverages to your new car, even while you’re at the dealership, by logging into your policy or calling 602-345-0360.