Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates. He has also been featured on sites like UpJourney.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like and Safeco. He reviews content, ensuring that exis...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Apr 25, 2020

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Here's what you need to know...

  • Transferring your auto insurance to a new car is not difficult to do
  • Be sure to check with your state’s auto insurance laws before making the switch
  • If you decide to keep your old car, you won’t be able to legally drive it without insurance

Transferring auto insurance is part of every new car purchase; thankfully, it’s not difficult to do. While you may have to jump through hoops to get a good deal,  you can often transfer your auto insurance with a simple phone call or online transactions.

The only caution in purchasing a new car and transferring your auto insurance is to be sure you do it by the letter of the auto insurance law.

States take insurance lapses very seriously – they won’t be lenient if you mess things up. As long as your car dealer, bank, and insurance company are well coordinated you should be

As long as your car dealer, bank, and insurance company are well coordinated you should be able to take care of things for you. All you’ll need to do is contact your insurance company to get the ball rolling.

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What is my actual part in transferring auto insurance?

Your auto insurance company takes care of all the paperwork and state filings, so you won’t have to worry about any of that. But you do need to contact them either online or over the phone to tell them about your new purchase.

Most of the larger, nationally known insurance companies allow customers to alter their policies online. If yours does, you’ll be able to log on to your account, add your new car to your policy, and drop your old one at the same time.

You’ll need to coordinate the dates so there’s no lapse, but you can accomplish this by allowing them to overlap by one day.

If you finance your new car purchase you’ll be required by your insurance company to provide the name and address of your lender. That’s because they need to know who else has a financial interest in the vehicle should it be totaled or stolen.

Sometimes this information can be entered online while other times it can only be done over the phone or in person. You’ll have to check with your car insurance company in order to know what’s required of you.

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What if I also need additional coverage?

The issue of needing additional coverage is actually quite common. People who previously drove an old junker with no collision coverage will find that a brand-new car will require collision or comprehensive by the bank financing it.

Fortunately, you can add to this coverage at the same time you’re transferring your auto insurance to your new car.

The change to your policy will be made instantly, with no money up front in most cases, but you will receive a bill in the mail for the extra charges.

One thing you do need to know about this process is the fact that insurance companies tend to use policy changes such as these as an opportunity to update your coverage.

So when you transfer your insurance they’re likely to ask you the same questions they did when you first got your policy.

These questions will include the distance you drive to work every day, who drives your car most often, whether or not it’s stored in a garage, etc.

Once my auto insurance is transferred, what happens to my old car?

Obviously, if your old car has been traded in, the dealer will dispose of it either through a sale or by scrapping it.

Either way, once the dealer takes possession of the vehicle you are no longer responsible for it in any way.

All you need to worry about is making sure your new car is properly registered and insured. You also might want to check with your insurance company two to three days after the transaction to make sure your old car has been taken off your policy.

If you decide to keep your old car, you won’t be able to legally drive it without insurance.

In some states, like New York, drivers are required to surrender their plates and registration if insurance coverage lapses. This is to help prevent drivers from getting on the road without insurance.

In other states, where tags are permanently affixed to a vehicle for its lifetime, your registration will probably still be canceled once the insurance coverage is removed.

Rest assured that your insurance company will notify your state electronically when the insurance on your old car is dropped.

Will there be any fees for transferring my auto insurance?

In most cases, you won’t be charged a fee for transferring your policy from one car to the next. That’s because you’re not really transferring your policy; you’re simply adding a new car and dropping an old one.

You may see a rise in your premiums, depending on the features of a new car, but there shouldn’t be any additional fees.

If your insurance company does charge you a fee, and that bothers you, you can always shop around for a new provider. Compare auto insurance rates online by entering your zip code now!

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