Does it Cost to Transfer Insurance to Another Car?

You might have to transfer your insurance when you’re ready to purchase a new vehicle. To be sure you’re receiving the best value now is an excellent time to review your insurance coverage and compare rates.
Does It Cost To Transfer Insurance To Another Car
Does it Cost to Transfer Insurance to Another Car?
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Does it Cost to Transfer Insurance to Another Car?

Yes, transferring your car insurance to a new car may increase costs. While there is usually no specific fee for transferring the policy, the premiums may rise. Factors influencing this increase include the new car being more expensive, having fewer safety features, or being a common target for theft. The rate adjustment aims to reflect the risk associated with the new vehicle.

How Much Will it Cost to Transfer Car Insurance to a New Car?

The cost of transferring car insurance to a new car varies, and while there’s typically no direct fee for the transfer, your premiums may increase. Several factors influence the potential rise in costs, including the new car’s value compared to the old one, safety features, and the vehicle’s susceptibility to theft. 

If the new car is more expensive, lacks safety features, or is a common target for theft, insurers may adjust your premiums to reflect the increased risk. It’s advisable to contact your insurance provider for specific details on how the transition will impact your policy and associated costs.

How Long Do You Have to Add Your New Car to Your Insurance Policy?

Typically, you have a grace period of seven to 30 days, depending on your location and insurance provider, to add a new car to your insurance policy. However, it’s crucial to note that many car dealerships mandate proof of insurance before allowing you to drive the newly purchased vehicle off the lot. 

Therefore, it’s advisable to promptly contact your insurance company to add the new car to your existing policy or obtain a new policy to comply with dealership requirements. Please do so to avoid complications and delays in acquiring your new car. Always check with your insurance company and dealership for their policies and requirements.

How to Transfer Car Insurance to a New Car in 5 Easy Steps

Navigating the process of transferring your car insurance to a new vehicle involves a few essential steps. Here’s a comprehensive guide to seamlessly transition your coverage while ensuring you meet the requirements and find the best rates for your new car.

1. Reach Out to Your Current Car Insurance Company

Initiate the process by contacting your existing car insurance provider when acquiring a new vehicle. Whether the purchase is from a dealership or a private seller, informing your insurer is crucial for compliance, especially considering dealerships often demand proof of insurance before allowing you to drive off with your new car.

2. Determine How Much Car Insurance Coverage You Need For Your New Car

Evaluate the coverage requirements for your newly acquired vehicle. Upgrading from an older model to a newer one may require additional coverage options such as gap or new car replacement coverage. If you have a loan or lease, meeting mandatory full-coverage insurance may involve adding comprehensive and collision coverage to your policy.

3. Research Car Insurance Quotes Carefully

Before transferring coverage, conduct thorough research to identify your insurance needs. Some insurers may not offer specific coverage types like gap coverage. If your current insurer falls short, explore alternatives or consider purchasing a separate gap insurance policy.

4. Compare Quotes From Multiple Insurance Companies

Since transferring coverage can influence your rates, obtaining quotes from multiple insurance companies is prudent. Comparing quotes ensures you secure the most competitive rate for your coverage. Utilize online platforms like Policygenius to simplify accessing and comparing car insurance quotes.

5. Get An Updated Rate

Anticipate changes in your insurance rate when transferring your policy to a new car. It’s advisable to seek a quote from your insurance company before acquiring the new vehicle, clarifying any adjusted premiums associated with the change. This proactive approach ensures you make informed decisions about your car insurance costs.

What Happens to Your Old Car After Auto Insurance Transfer

After transferring auto insurance to your new car, the fate of your old vehicle depends on whether it was traded in or retained. If traded, the dealer will handle its disposal through sale or scrapping. Once the dealer takes possession, you’re no longer responsible. 

Ensure your new car is registered and insured, and check with your insurer a few days post-transaction to confirm the removal of the old car from your policy. Keeping the old car mandates continuous insurance for legal driving. Some states may require plate surrender if coverage lapses. Insurance companies electronically notify the state when coverage on the old car ceases.

When to Transfer Car Insurance

When purchasing a new car, proof of insurance is essential before driving off the lot. While some insurers offer a grace period, it’s not guaranteed, making it crucial to ensure coverage even for a brief period until you reach home. Exceptions exist, such as cash payments or policies with grace period clauses, potentially delaying the immediate need for insurance. However, auto loans or leased vehicles typically require immediate proof of insurance. It’s important to note that any grace period often covers the previous vehicle’s value, leaving a potential gap in coverage for a new car, especially if it’s more valuable.


Transferring car insurance to a new vehicle involves cost considerations, coverage adjustments, and adherence to specific timelines. While there’s generally no direct fee for the transfer, the premiums may increase based on factors like the new car’s value and safety features. 

To ensure continuous coverage, timely communication with your insurance provider is essential, especially when acquiring a new vehicle. Navigating this process with careful research, comparing quotes, and staying proactive in updating your policy guarantees a smooth transition, leaving you well-informed and adequately protected on the road.

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Picture of Aniket Kulkarni

Aniket Kulkarni

A seasoned Product Manager specializing in car insurance content, Aniket has a passion for simplifying complex insurance concepts. His strategic approach to content development reflects years of experience in the product development industry, coupled with a commitment to providing accurate, reliable information.


This page is purely informational. Beem does not provide financial, legal or accounting advice. This article has been prepared for informational purposes only. It is not intended to provide financial, legal or accounting advice and should not be relied on for the same. Please consult your own financial, legal and accounting advisors before engaging in any transactions.

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