Guide
Buying a car
You need insurance before you drive a car you own. The dealer or seller will often ask for proof.
At a glance
- Have liability coverage in place Required by law
- If you finance or lease: collision, comprehensive and gap Often required by someone else
- Choose limits and deductibles Optional
- List every regular driver Often required by someone else
-
1 Have liability coverage in place
Required by lawEvery state except New Hampshire requires it. Check your state's minimum, then consider higher limits.
Read more: Car insurance
-
2 If you finance or lease: collision, comprehensive and gap
Often required by someone elseThe lender will require collision and comprehensive. Consider gap insurance: if the car is totaled early, it pays what you still owe beyond the car's value.
-
3 Choose limits and deductibles
OptionalHigher deductibles lower your premium, but you pay more after a claim. Higher liability and uninsured motorist limits cost more but protect more.
-
4 List every regular driver
Often required by someone elseAnyone in your household who drives the car regularly usually has to be listed. Leaving someone off can lead to a denied claim.
Things that often surprise people
- Insurance generally follows the car: if a friend borrows it and crashes, your policy pays first.
- Driving for a rideshare or delivery app isn't covered by a personal policy without an add-on.
- Hitting a deer is a comprehensive claim, not a collision claim.