Buying a car, whether new or used, is an exciting experience because of the hunting for the perfect car, test driving, and the smell of a brand new vehicle. The only thing that is not appealing through this experience is the paperwork. You need to do several procedures which can be confusing and frustrating, whether it is registering the car or getting auto insurance. It is essential to get insurance for your car to keep yourself, your family, and others on the road safe. Insurance coverage also protects you financially in case you get into an accident. So, when is the perfect time to get insurance for your car, before or after purchasing it?

Start Insurance Shopping Before You Buy a Car

It is crucial to start shopping for auto insurance before you purchase a car. You should get approximate, or preferably accurate, insurance quotes to know if you can afford the car’s insurance premium or not. It is quite frustrating to buy a new car to find out later that you can’t get insurance for it. Searching online for auto insurance rates will lead you to great deals, so you must take your time browsing through various insurance companies. You should provide the insurance company with the vehicle identification number to get a personalized insurance policy.

Buying From a Dealership

Many dealerships require proof of insurance before allowing you to drive your new car off their lot. Even if you paid in cash, they need to see the proof of insurance to ensure that you are covered while on the road. If the dealership helped to fund your car purchase, it will increase the probability that they won’t allow you to take it off their lot without proof of insurance. You have to sort out your insurance coverage before you buy a car from a dealership. Your other option is to leave your new car at the dealership’s lot until you get proof of insurance. The dealership may offer you to insure your car, while it might be a convenient option, you might not get the best offer available.

Taking Out a Loan

Loans are a common option for funding car purchases. You will most likely need to get insurance coverage before taking out a loan from a lender. While dealerships only require proof of insurance, lenders require that you have several coverage plans such as liability, coverage, collision coverage, and comprehensive coverage. The lender, whether a bank or a financial institution, will give you an estimate for a car loan based on the car model and insurance coverage. The lender requires such extensive insurance coverage plans to ensure that the car is covered in the case of an accident as they technically own the car until you pay off the loan.

Buying From a Private Seller

This is almost the only case when you can get insurance coverage after you buy a car. The transaction between you and the seller doesn’t require proof of insurance, that is only when you pay for it in cash. If you are taking a loan to buy a car from a private seller, you still need to get insurance coverage to present it to your lender, not the seller though. However, you put yourself at a financial and health risk if you decide to drive your new car home without insurance.

You Can Use Your Grace Period

If you already have a car insurance plan with another vehicle, your insurer may provide you with a grace period when you purchase a new car. Grace period is an amount of time ranging from 7 to thirty days after buying a new car that your vehicle will be covered even if you haven’t called your insurance agent and reported the new purchase to them. However, the grace period is applicable if you purchased your new car with cash and the policy has a grace period clause. The length of the grace period varies from one insurance company to another, and they transfer the current coverage plan, so if you want additional plans, you need to contact them and inform them of your needs.

The safest option, and sometimes the only option, is to get an insurance coverage plan before you buy your new car. It is highly risky to drive your new car without insurance even if you are driving in a couple of streets, as anything can happen at this time and you will suffer financially as a result. Additionally, dealerships and lenders won’t allow you to buy a car or at least drive it without insurance coverage.