Confirm Coverage Before You Sign
You need active insurance before the dealer releases the vehicle. Most dealers will not let you drive off without proof of coverage, so arrange your policy before you arrive.
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Binding the Policy
Contact your insurer or broker the same day you intend to buy. You can usually bind coverage by phone or online with the vehicle details, your driver history, and payment information. Ask for a confirmation number and keep it accessible.
What the Dealer Typically Requires
- Proof of insurance card or binder
- Minimum liability limits set by your state
- Dealer-specific requirements for physical damage coverage if you are financing
If You Are Financing
Lenders often require comprehensive and collision coverage with a deductible you can afford. They may also mandate gap insurance if the loan exceeds the vehicle value. The dealer can sometimes add these products on the spot, but you can often secure better terms directly from your insurer.
Documentation to Bring
- Valid driver license
- Dealer invoice or purchase agreement
- Vehicle identification number (VIN)
- Payment method for the first premium
Common Pitfalls
Avoid assuming your existing policy automatically covers a new vehicle; many policies give only 7 to 30 days of temporary coverage for a replacement car, and a new purchase may not qualify. Also, do not let the dealer pressure you into a policy without comparing limits and deductibles first.