Yes, you generally need an active car insurance policy before driving your new car off the lot. In nearly every state, including Illinois, driving any car without at least basic liability insurance is illegal. Most dealerships will require proof of insurance before allowing you to drive the vehicle home.
In Illinois, operating an uninsured vehicle can result in fines of $500 or more and a suspended license plate. It’s important to have coverage arranged either in advance or on the spot. If you already have car insurance, your existing policy typically provides temporary coverage for a newly purchased car (often for 7–30 days) until you add it to your policy.
Always notify your insurer about the new vehicle as soon as possible to avoid any lapses. For help insuring your new car or getting a quick quote, call Insure on the Spot at 773-202-5060.
Do I Need Insurance Before Buying or Picking Up a New Car?
Yes, you should have insurance in place before driving a new car. While it’s possible to purchase the car without insurance, you cannot legally or safely drive it on public roads without at least basic liability insurance.
Dealerships often won’t let you drive off without proof of insurance. If you already have an auto policy, you might have automatic coverage for the new vehicle for a short period (7 to 30 days). However, you still need to update your policy as soon as possible.
If you don’t have an existing policy, you must set up insurance before taking possession of the car. Many insurers offer same-day coverage, and dealerships may even help you contact an insurer to arrange the coverage on the spot.
Will My Current Insurance Cover My New Car (Grace Periods)?
If you already have auto insurance, your policy typically extends to your new car for a short period – known as a grace period. This grace period usually lasts from 7 to 30 days, depending on your insurer. During this time, your new car is covered under the same level of coverage as your previous car. However, it’s crucial to update your policy quickly. If you had liability-only coverage for your old car, your new car will only have the same coverage during the grace period. If you had full coverage, your new car will temporarily have full coverage. Don’t delay – contact your insurer as soon as possible to ensure your new car is fully covered.
Key Takeaways:
- The grace period extends only for a short time and typically applies to the same level of coverage.
- You need to officially add the new car to your policy before the grace period expires.
- If you had no prior insurance, you must obtain a policy immediately.
How Can I Get Insurance for a New Car Quickly?
Getting insurance for a new car is a simple process and can be done on the same day you buy the car. If you’re already insured, you can usually call your insurance company from the dealership to add the new vehicle to your policy. If you’re a first-time buyer or switching insurers, follow these steps:
- Gather Necessary Information: Have details about your car, including the vehicle identification number (VIN), make, model, year, and your personal info ready.
- Contact an Insurer: You can call your current provider or shop around for quotes. Many companies provide immediate coverage once payment is made.
- Choose Coverage: While you must meet the state’s minimum insurance requirements, consider adding collision, comprehensive, and gap coverage for better protection.
- Get Proof of Insurance: Once you’ve selected coverage and made payment, you will receive proof of insurance, which is needed before you can drive the car off the lot.
Many insurers offer instant proof of insurance through mobile apps or email, making it easy to show the dealership.
What Coverages and How Much Insurance Does a New Car Need?
At a minimum, your new car must meet your state’s legal insurance requirements. For Illinois, this typically means having liability coverage with limits of $25,000 per person, $50,000 per accident, and $20,000 for property damage.
However, because your car is new and likely financed or leased, it’s advisable to have more than just the minimum.
Coverage Options to Consider for Your New Car:
- Collision Coverage: Pays for repairs to your car if you’re at fault in an accident.
- Comprehensive Coverage: Covers non-collision incidents like theft, fire, or vandalism.
- Gap Insurance: Covers the difference between what you owe on the car and its actual value if the car is totaled or stolen.
- New Car Replacement Coverage: If your new car is totaled, this coverage will replace it with a brand-new car of the same make and model.
If you are financing or leasing the car, the lender will require you to carry both collision and comprehensive coverage. It’s also a good idea to consider increasing your liability limits and adding uninsured/underinsured motorist coverage for additional protection.
Why Is Insuring a New Car More Expensive?
New car insurance premiums are typically higher than those for older cars. Here are the main reasons why:
- Higher Vehicle Value: New cars are more expensive to replace, so insurers charge higher premiums to reflect the increased potential cost of a claim.
- Cost of Repairs and Parts: New cars often feature advanced technology and more expensive parts, which increase repair costs.
- Increased Coverage Needs: New cars often require more extensive coverage, such as collision and comprehensive, which raises the premium.
- Safety and Theft Risk: Insurers also consider how likely the car is to be involved in claims or stolen. Sports cars and luxury vehicles tend to have higher premiums due to their risk profile.
FAQs: Insuring a New Car
Q: Do I need insurance to drive a new car home from the dealership?
A: Yes. You must have insurance before driving your new car off the lot. Almost every state requires at least basic liability insurance, and dealerships will ask for proof of insurance before you can drive away. If you already have auto insurance, your current policy may cover the new car temporarily.
Q: How long after buying a new car do I have to get insurance?
A: You need to have insurance immediately. If you have an existing policy, most insurers offer a grace period of 7–30 days to add your new car. Be sure to update your policy as soon as possible to ensure full coverage.
Q: Will my current car insurance automatically cover my new car?
A: Yes, but only for a short time. Your existing policy typically covers your new car for a brief grace period, which can range from 7 to 30 days. However, you must inform your insurer and officially add the new car to your policy within that time.
Q: What types of insurance should I have for a brand-new car?
A: At minimum, your new car should have liability coverage. It’s highly recommended to add collision and comprehensive coverage. If you have a loan or lease, the lender will require these coverages. Gap insurance is also a good option if you owe money on the car.
Q: How can I save money on insurance for a new car?
A: To save on insurance, shop around for quotes, ask about discounts (e.g., for good driving, bundling policies, or safety features), and consider adjusting your deductibles. Maintaining a clean driving record and good credit can also help lower your premium.
Get a Quote Today!
Ready to insure your new car or have more questions? Call Insure on the Spot at 773-202-5060, or get a fast, free quote online. Our agents will help you compare rates and find the best coverage for your new ride. Drive off with confidence knowing you’re fully insured!