Is my New Car Automatically Covered by Insurance?

People often go out to shop for a car over the weekend when their agents are closed so they may need an arrangement to tie them over. The implications are totally different when keeping the old one and replacing it. In both cases, most insurance companies offer coverage for this newly bought auto for a short period of time to allow finding a permanent solution.

Do Current Policies for Traded in Cars Insure the Replacements?

This is more straightforward. Usually, companies make provisions to cover a replacement when the original vehicle is disposed of around the time of getting the other one. In most cases, you are protected because you have only one car in your possession.

It is a simple switch in most cases but it could be a lot more than that, especially when you get a totally different type of an auto. For example, getting a flashy fast car instead of a sedan isn’t just one for the other, especially if there are younger drivers involved. That is why you should act in your earliest convenience.

There are regulations regarding this in most state laws. For example, in Texas you have 30 days to notify the carrier of change of vehicle. Of course, the sooner the better and this may not be applicable in your state, as they may legislate a much shorter period or have no rules on it at all. It is always best to call them and ask about what coverage they offer to a car you just bought and let them know of the switch immediately, if possible.

As a result, you may need to pay an additional premium or get a refund. But this doesn’t stop anything and you would automatically get the same auto insurance protection that was in place.

Is My New Car Covered by an Existing Policy for Another? 

The situation is totally different if you were to keep the old one. Most companies would be happy to include it until you make alternative arrangements but you should call them first before driving it. Generally, an existing policy for another vehicle should cover the newly purchased auto for several days (3 – 4 days) automatically and the protection would be the same as the currently insured car.

If you are trying to get rid of the existing automobile in the meantime, speak to the insurer and they may agree to keep both vehicles on for an agreed period. Whichever way you like to deal with it, you should attend to this matter almost immediately.

It is often easier if you already have a multi-car policy and the late addition would be included in it for a few days as before. The provisions would be the same as the maximum offered for any of the vehicles in the plan. Then, it is up to you to make it permanent or look for alternative quotes.

These rules are there to give people a little time just in case they have no means of dealing with it there and then. It is important not to appear to be abusing this tolerance. Usually, 2 – 3 days would be plenty. Delaying it may mean that you are taking a chance, unless you know you are allowed a longer time.

Also, the company or state may have different reporting rules. It is always best to check this and make sure that it is insured and you can drive it home with absolute peace of mind. If you didn’t, you can perhaps ask the dealer about the rules or check online quickly if there is reference to the matter in the state laws. Furthermore, this question may have already been answered on their websites or have online chat facilities 24 hours a day. The above terms are generally valid but it is always best to be sure.