insurance for used car

Is your current vehicle experiencing major issues? Are you ready to trade it in for something more reliable?

If you don’t want to spend a fortune when doing this, you should stick with shopping for a used automobile.

When you buy any type of vehicle though, you’ll need car insurance for it. Insurance is a requirement for all drivers.

If you’re wondering about the costs of insurance when buying a used car, there are a lot of factors that affect the amount.

As you start searching for a used car to buy, here are some of the top things you should know about purchasing insurance for the car.

You Can’t Get a Solid Quote Until You Select a Vehicle

Car insurance offers coverage for a specific vehicle, which means you cannot get a firm quote until you choose a car.

Agents can, however, offer estimates for insurance costs. Just keep in mind though that an estimate is not a set-in-stone amount.

To get an accurate quote, you’ll need to supply the details of the vehicle you want to cover. You’ll need the car’s year, make, and model, and you’ll also need its VIN.

It’s a good idea to do some research on this subject first though. Calling around will help you get a better idea of which insurance company you’d like to use for your coverage. 

Doing this will make it easier for you to get the policy started when you need it, and you may need it before you can drive away with the vehicle you buy.

You’ll Need a Policy Before You Drive off the Lot

Where do you plan on buying a used vehicle? Will you go to a dealership, or do you plan on shopping for cars for sale by private sellers? The answer to this question makes a difference when you need to purchase insurance for the car you buy.

If you buy a car from a private seller, you can purchase the vehicle first and then an insurance policy. The person selling the automobile isn’t going to ask to see your insurance card.

You can get a policy started when you get time, but you should limit your driving until you get a plan in place.

If you buy a car from a dealership, there is a requirement for proving insurance. This requirement states that you cannot leave the lot without showing that you have insurance. So, how do you get proof of insurance before you leave the lot?

You call an insurance company and buy a policy. Once you pay the upfront costs, they’ll email you a copy of your policy. You can give this to the dealer and leave with your new vehicle.

The Amount You Pay for Insurance When Buying a Used Car Varies

Now that you understand why you need auto coverage and when you need to buy it, there are a lot of things you should know about the types of coverage you should select.

Cash Purchase

Let’s start with a cash purchase. If you pay cash for a car, you’ll have more freedom and flexibility with the coverage you purchase.

A cash purchase means you will not be getting a loan on the car. If you have no loan, you can get by with minimum insurance coverage. You could purchase a policy that includes liability coverage only.

Liability coverage is the primary type you need to meet the state requirements for auto insurance. It protects other drivers in situations where you cause collisions. It doesn’t protect you or your car though.

Finance Purchase

If you finance the car, which means you get a loan to buy it, there are more requirements. When financing a car, you have a lender telling you what types of coverage you must have.

Financing includes buying and leasing. If you get a loan, you are buying the vehicle. If you finance an alternative way, you are likely leasing it.

Lenders generally require three types of coverage when you choose either type of financing. One is liability coverage, so this is an option you’ll need if you pay cash or finance the automobile.

The second is collision coverage. Collision protects you and the lender if you wreck the car. If you wreck your car, it’s your collision coverage that pays for the repairs.

The third is comprehensive coverage. Having comprehensive coverage fills in the gaps where collision coverage is lacking. Comprehensive protects you from vandalism, storm damage, animal collisions, and other non-driving related incidents.

The Factors That Affect Your Policy Costs

Now let’s talk about the amount you’ll pay for your policy. It’s nearly impossible to guess how much your plan will cost without more information. Insurance agents factor in many details to come up with quotes, including the following things:

  • The vehicle you insure – The age, make, safety ratings, and more all matter to insurance companies
  • Your driving record – Your risk level is a primary factor in the amount you pay
  • The types of coverage – You’ll also pay rates based on the coverage types you select

While it’s possible to get a quote for coverage without choosing a car, it’s impossible to find out the exact premiums you’ll pay until you have a specific car in mind.

Where to Shop for a Used Car

You’ll need insurance when buying a used car, but you’ll also need to select a vehicle to buy.

If you’re ready to start shopping, visit our dealership today. We offer a variety of used cars for sale, and we accept trade-ins. Check out our site to view our inventory to get an idea of the options we have on hand right now.