If you own a vehicle, you probably have auto insurance on it. If you do not, you should buy a plan now, as driving without insurance is not wise. What happens, though, when you have a car and decide to trade it in? How do you change your policy, and when should you change it? If you want to trade in your car, here are several things to know about updating your auto insurance plan.
Your Current Plan Might Cover the New Car
The first thing to know is that if you already have an auto insurance plan, it might extend coverage to a new car after trading in your other one. This coverage might last for 24 hours or 30 days. It just depends on your insurance company and the coverage you have.
One important thing to know is that your current plan's coverage might extend to the new vehicle, but it will only provide the same coverage types. For example, if you have liability coverage only on your existing car, you will only have liability coverage on your new car. If you need full-coverage insurance, you will need to purchase insurance on the new car before leaving the car lot.
The Dealership Might Require Changing the Plan Before You Leave
The second thing to know is that some dealers ask you to change your insurance plan before you leave the dealership with your new car. Dealers require this for protection and because lenders might require that buyers have proper coverage before leaving the lot and driving their new car. If you bought a new car and ended up in a collision on the way home, what would you do? What would happen if your insurance did not cover the incident? It is critical to update your insurance as soon as possible.
It's Better to Play It Safe
The final thing to know is that it is better to play it safe than sorry. If you update your insurance plan before leaving the car lot, you can have confidence that you have the right and necessary insurance plan for your new vehicle. Even if the dealer or lender doesn't require you to update your insurance, you should do so anyway.
If you want to get rid of your old car and buy a new one, you can visit a dealership of your choice. You might want to contact your car insurance agent before you go shopping for a new car, or you can call the agent while you are at the dealership. Agents can start a new policy for you right away to provide you with the auto coverage you need.
For more information about what updates a car insurance agent can make to your policy, contact a local insurance company.
Share13 October 2020
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