Updated: May 18
Straightening out your auto insurance before you purchase your new car, can save you hundreds of dollars. While a new vehicle payment might be affordable, you need to consider your auto insurance premium as part of the cost.
If you’re replacing a vehicle on your policy, usually the same coverage will extend to your new car. Check with your agent /advisor before you purchase rather than assuming you have coverage. If you’re not replacing a car, you may not have any coverage at all.
Don’t assume the dealership will take care of the insurance for you. It is not their responsibility to call and add a car to your policy.
Understand what coverage limits and deductibles you must buy. Lienholders and lessors usually ask for deductibles that are $500 or under.
Consider gap insurance. Cars depreciate. Gap insurance pays the difference between the value of the vehicle at the time of its total loss and what you still owe on it.
Work with your agent/advisor to help you identify the best coverage for you and your new car.