Car insurance is an important step in any new or used vehicle purchase.
First, it will allow you to register the vehicle and comply with your state’s financial responsibility laws.
Second, it will allow you to protect yourself financially in the event of a collision, damage, or theft involving your new car.
This page will provide you with an overview of the steps of getting a new policy as well as some tips for finding the biggest savings on the coverage you need.
Steps to Buying a New Car Insurance Policy
If you’re buying car insurance for the first time, don’t worry! Getting a new policy is a fairly simple process.
After you’ve completed the sale, meeting the car insurance requirements after buying a car is generally the next step you’ll need to take.
First, we’ll provide you with an overview of the steps involved. Later we’ll dive deeper into some of the most important things to consider when shopping for a new policy.
How to buy car insurance:
- Get your personal information and vehicle details ready.
- Choose your coverage.
- Compare quotes from different providers.
- Decide how to pay for the policy.
- Sign your policy documents.
Buying car insurance is a simple, straightforward process. Your main consideration should be choosing the right coverage and making sure you’re getting the best deal. More on that below.
What Information Do You Need to Buy Car Insurance?
Before you get started with comparing quotes, you should be sure to gather all the necessary information.
In order to get an accurate quote from different car insurance providers, you’ll first need to provide them with a little bit of information.
Your personal information, driving history, and vehicle details are all used to determine your risk factors and how cheap or expensive your policy may be.
When you begin to shop around for car insurance, you should be prepared with the following details:
- Your name, address, and date of birth.
- Your driver’s license number.
- The number of years you’ve been driving and details of any recent accidents or tickets.
- Your current insurance provider.
- The details about the vehicle you want to insure including the year, make, model, VIN, odometer reading, estimated annual mileage, and any safety features it may have.
If there will be other drivers on the policy, you’ll need to include their information as well.
With this basic information, you’ll be able to fill out and receive detailed quotes from a variety of different insurers.
How to Determine What Coverage You Need
As you get started shopping for a car insurance policy, you’ll need to think about the types of coverage you’ll need.
No matter what, you’ll first need to be sure to meet your state’s minimum liability coverage requirements.
Liability insurance typically includes:
- Bodily injury coverage per person and per accident.
- Property damage coverage per person and per accident.
Each state has a slightly different minimum liability coverage requirement, but the insurance providers will help you determine the minimum limits when you complete a quote.
Additional coverage you may need includes:
- Uninsured or underinsured motorist coverage.
- Collision coverage.
- Comprehensive coverage.
- Medical payments coverage.
- Personal injury protection coverage.
- GAP insurance.
Liability coverage is used to pay for damages and injuries in an accident where you are found to be at fault.
Uninsured or underinsured motorist coverage is used when an accident is caused by another driver who doesn’t have insurance or doesn’t have enough coverage to pay for the full costs.
Collision coverage is used to pay for damages to your own vehicle in an accident, regardless of who is at fault.
Comprehensive coverage can be used to pay for damage that occurs outside of an accident. Examples include weather damage, falling objects, theft, or vandalism.
Medical payments coverage is used to pay for medical expenses for you and your passengers in an accident.
Personal injury protection covers medical expenses and related damages as a result of your and your passenger’s injuries in an accident.
GAP insurance kicks in if your car is totaled when you still owe money on the lease or loan.
Other policy add-ons you may consider include roadside assistance, rental car coverage, and new car replacement coverage.
Compare Car Insurance Providers
Once you know what type of coverage you need, you’re ready to start comparing quotes.
Different insurance providers offer different rates on the same coverage for a variety of reasons. And, the rates offered will change throughout the year and over time.
Why should you shop around for car insurance?
Since getting a quote only takes a few minutes, it can pay to compare.
The difference in coverage costs can add up to hundreds of dollars or more per year.
You’ll typically need to fill out different quotes for each of the different companies you’re comparing, which can be a hassle, but is well worth it before you decide on a policy to buy.
Where to Buy Car Insurance
You have a few different options of where you can buy your car insurance policy. These include:
- Directly from an insurance company.
- From a captive insurance agent.
- From an independent insurance broker.
- From a specialty insurance agency.
Purchase your New Insurance Policy
Once you’ve found a provider and a policy that fits your needs, you’ll be ready to purchase it.
Your final decision will be to determine how you’re going to pay for the policy. The common options include:
- Pay in full.
- Pay half.
- Pay monthly.
The overall cost of your policy may vary depending on how you decide to pay.
In general, paying in full can save you some money on the overall cost of your premiums.
Can You Get a New Car Insurance Policy Online?
Luckily, you can get a new policy online and instantly.
Most car insurance companies will allow you to complete a quote, sign your policy documents, and pay instantly online or over the phone.
When you’re in the process of buying a car, this option is extremely convenient.
In most cases, you cannot and should not drive away with your newly purchased vehicle before you have the appropriate car insurance coverage.