How to Get Car Insurance Before Buying a Car
Before you can buy a car, you need to purchase car insurance. Here’s how to find the best rates, pick your coverage, and get insured in time to sign.
Written by R.E. Fulton
Reviewed by Kathleen Flear
If you’re planning to buy a car soon, you can use the make and model of your new vehicle to shop around for
car insurance quotes
—and once you’ve settled on a specific vehicle, you can use the VIN to purchase insurance before you buy. If you’re getting ready to
buy your first car
, you’ll need to get your insurance coverage in place before you sign on the dotted line—otherwise, you won’t be allowed to drive your new ride home!No matter what your situation, here’s what you need to know about buying
car insurance
before purchasing a car. Compare insurance quotes from 50+ carriers with Jerry in under 45 seconds (Title in payload)
4.7/5 rating on the App Store | Trusted by 5+ million customers and 7 million cars4.7/5 app rating | Trusted by 5M+ driversDo you need to have car insurance before you buy a car?
Yes—
car dealerships require proof of insurance
to finalize a new or used car purchase. If you’re financing your car, your lender will likely also require you to purchase full coverage insurance
. Unless you’re in one of the few states that don’t require drivers to carry
liability insurance
, you can’t drive a car off the lot until you have the right insurance coverage. It’s very difficult to buy a car without auto insurance unless you have an existing policy
from another vehicle. Buying insurance is a lot less exciting than
buying a new car
, but you’re better off buying it in advance rather than waiting until the last minute. Why? Comparing car insurance quotes in advance gives you time to find the best deal, and it can even give you a better estimate of your ownership costs. Key Takeaway You need to have car insurance before you can bring a new car home, and shopping in advance helps you find the best deals.
MORE: Factors to consider when getting insurance for a new car
How to find auto insurance before buying a car
If you’ve never bought a car insurance policy before, don’t worry—getting the coverage you need as a first-time car owner is fairly straightforward. It’s also quick: most insurance companies will give you
same-day coverage
that activates within a few hours of your first payment. But don’t leave insurance shopping to the last minute just because you can! Instead, shop smart by taking these steps early on in the car buying process.
Before you’ve picked out a car:
You won’t be able to purchase an auto insurance policy until you have the unique vehicle identification number (VIN) of the specific car you plan to buy—but that doesn’t mean you can’t start shopping earlier. Most car insurance companies will give you a quote based on your personal information along with the make and model of the type of car you plan to purchase. Just keep in mind that the quote will most likely change once the full VIN is updated.
To get started, you can:
- Evaluate your budget and coverage needs: How much of your monthly budget can you afford to spend on car insurance? Are you also taking out a car loan? How much coverage is required in your state? Compare the types of insurance offered by different companies to see what’s right for you.
- Compare multiple quotes: Auto insurance companies use different calculations to set your rate, and they may offer you different discounts. Get quotes from at least three to five different companies to compare your options and find the best rate.
- Gather information for all drivers on the policy: You should have the name, birthdate, Social Security Number, driver’s license number, and driving history of every driver who will be included on your new policy.
Once you’ve chosen a car:
Once you’ve settled on a specific vehicle, you’re ready to buy a car insurance policy!
- Choose your company: Based on the quotes you got above, along with customer reviews and financial ratings, choose the insurer that fits your needs.
- Get the VIN: You’ll need the VIN for your new car to get a policy from your chosen insurer.
- Schedule the start of your policy: Make sure that your policy is set to start before you take possession of the car. The last thing you want is to be uninsured when you’re ready to drive off with your new ride!
Your new insurance company will issue an insurance card that you can use as
proof of insurance
at the dealership when you buy your car. You’ll also need to keep a copy of your proof of insurance in the car at all times, which is easier now that it is legal to show proof of car insurance on your phone in all 50 states. How much coverage should you buy for a new car?
One of the hardest parts of buying car insurance for the first time is figuring out how much coverage you need. Every driver’s needs are a little different—here’s how to narrow down what
type of coverage
is right for you: Check your state’s laws
To determine how much coverage you’re required to carry, check the
insurance laws in your state.
Every state except New Hampshire
and Virginia
requires all vehicles on the road to have car insurance. Typically, state mandates include set amounts of bodily injury liability
and property damage liability coverage
. Depending on the state, you may also need to carry: While you’re at it, check the terms of any financing agreements. In most cases, lenders require drivers to purchase
collision coverage
and comprehensive coverage
for any financed or leased vehicle. Consider the value of the car you’re buying
Once you know which coverage is mandatory, it’s time to consider additional coverage options. If you’re buying a used car with high mileage and a low market value, it probably doesn’t make sense to spend a lot on comprehensive and collision insurance, which come with out-of-pocket
deductibles
that could be higher than your car’s value! But for brand-new vehicles—especially
luxury cars
—full coverage is typically a good idea. You should also consider adding gap insurance
or new car replacement insurance
if your insurance provider offers it. Evaluate other risk factors
Car insurance is all about risk, and so is the amount of coverage you need. Do you have teenage drivers on your policy? Consider raising your liability limits. Do you live in an area where
hitting a deer
is a rite of passage? Think seriously about buying some comprehensive coverage. A local insurance agent can help you evaluate the best options for your situation. Look at your budget
Try to balance the coverage you need with your budget. Comparing car insurance rates from multiple companies is the best way to find an insurance premium that won’t break the bank—without sacrificing your protection.
If you’re having trouble finding coverage you can afford, look for car insurance discounts that can lower your auto insurance rates. Companies like
Allstate
, Progressive
, and Nationwide
offer a wide range of discounts. “Jerrywas a great experience. It was my first time buying insurance, and they took their time explaining a lot of insurance terms for me. Shopping around for quotes was super easy!” —Dakota F.
Average car insurance costs for new and used cars
Not sure how much to budget for your new insurance policy? Car insurance costs are highly personalized, but the average cost of full-coverage insurance for a new car is about $1,771 per year. For used cars, the rate is typically a little lower.
Keep in mind that various rating factors will impact the insurance quotes you get from different providers. While rules and regulations vary between states and companies, these are the most common factors:
- Your age
- Your gender
- Your credit score (in most states)
- The make and model of your new vehicle
- Your ZIP code
- Your driving record
- Your insurance history
Can you ever buy a car without insurance?
Technically, you might be able to buy a car without insurance—but you won’t be able to drive it away until it’s covered by a valid insurance policy. That’s why dealerships check your insurance before you sign. Even if you find a dealer or
a private seller
that’s willing to finalize the deal without proof of insurance, you won’t be able to legally drive the car until you’re covered. "You must get this app! It’s my first time getting my own insurance, so I called a few companies myself. Their rates priced me around $600/month. I usedJerryand my rates went down to $250/month. I’m so happy!” —Melissa C.
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Should you get car insurance before or after buying a car?
It’s always better to shop for auto insurance before you buy a car, especially if you don’t have an existing policy. If you already have insurance, you can let your provider know after you’ve purchased your new vehicle.
How soon after buying a car do you need insurance?
Most car insurance companies require you to report a new car purchase within seven to 30 days. If you are in an accident or at a traffic stop before adding the car to your insurance policy, you can still get a ticket for driving an uninsured vehicle.
Do you need insurance to buy a car from a private seller?
While dealerships typically check your insurance before you buy, a private party might not. However, you’ll still need insurance to legally drive any car you buy—no matter where you got it.
Can I drive a car I just bought without insurance?
No. Even if you live next door to the dealership, making the one-block drive without proper insurance is illegal—unless you live in a state that permits car owners to drive without insurance.
