car dealership

Do I Have Insurance When I Drive My New Car Off the Lot?

On a whim one Saturday afternoon, you go car shopping and drive away in a 2013 Honda. Do you have insurance coverage for the rest of the weekend until Neckerman opens at 8:00 on Monday morning?

Yes. Most insurance companies provide automatic coverage for new purchases equal to the broadest coverage you have on your current or other cars. In other words, if you already have a car insurance policy in effect and you purchase a new vehicle, that policy will cover you for up to 4 days.

Example: You currently own a 2002 Camry and you trade it in for the 2013 Honda.

  • If the Camry is the only car listed on your policy, the Honda will automatically have the same coverage as the Camry for up to 4 days.
    • Beware: If you do not have comprehensive and/or collision coverage on the car you are replacing, you will not have this coverage on your new vehicle. The automatic coverage is only as good as the coverage you had before. It’s vital to contact your agent before your purchase, especially if you finance or lease the new car.
  • If you have multiple cars listed on your policy, your new vehicle will automatically have the greatest level of coverage of any car listed on your policy. Remember, this is for only 4 days with most companies. You do need to call your agent promptly and provide the year, make, model and VIN plus contact information for any lender or leasing company.

If you are purchasing your first car or a new car and you don’t have insurance yet, you will need to get insurance well in advance of driving the car off the lot. Remember, auto insurance is required in Wisconsin.

Will the dealership notify my insurance company when I buy a new car?

No, this is also your responsibility. Do not rely on the dealership to do this for you, even if they say they will!

How much time do I have to add a new car to my existing car insurance policy?

Again, you typically have 4 days to notify your agent of your new vehicle purchase. This is not true of all insurance companies so be sure to contact your agent to know how your insurance works. It’s always best to notify your agent in advance.