Do Car Dealerships Check Your Insurance?

Car dealerships generally ask for proof of insurance before letting you drive, which they verify using modern software or an old-fashioned phone call.
Written by Jasmine Kanter
Edited by Amy Bobinger
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It’s illegal to drive without a valid driver’s license and proof of insurance, and a reputable dealership will check both before allowing you to drive a new car off their lot. You can buy
car insurance
at the dealership—but you’ll save money if you compare rates and purchase a policy ahead of time.

You need to show proof of insurance to drive

To avoid any possible liability, dealerships generally ask car buyers for a valid driver’s license and proof of insurance before allowing them to drive their new car home.1
You can present
proof of insurance
as a physical card, digital card, or attestation letter from your auto insurance company. If you’ve insured your car through the
Jerry
app, you’ll always have access to your insurance card in the virtual glovebox. 

Dealerships verify insurance with software and phone calls

Modern car dealerships use software for automatic insurance verification. The dealership may enter your details through an online portal that checks your insurance status, or ask you to complete a form through an email link.
If all else fails, the dealership can manually verify your insurance by calling the DMV or your insurance company. They’ll provide your contact info, vehicle identification number (VIN), policy number, and other details, then wait for the DMV or insurance agent to confirm. 

Car insurance is the responsibility of the vehicle owner

It’s an established practice for dealerships to ask for auto insurance, but they may not be legally required to do so. Several state courts have ruled that dealerships can’t be held liable for failing to ask for proof of insurance, failing to verify fake proof of insurance, or letting a buyer drive uninsured.23
Once the
transfer of ownership
is complete and the car title is in your name, insuring it is your responsibility. The law applies whether you’ve just bought a brand-new car from a dealership or a used vehicle in a private sale.4
To avoid the penalties of
driving without insurance
—including fines, driver’s
license suspensions
, vehicle impoundment, and jail time—you must buy car insurance before you drive.

How much car insurance should you buy?

For most drivers, the best level of coverage is
full coverage car insurance
that includes:
We recommend setting your liability limits at at least $50,000/$100,000/$50,000 to avoid costly liability after a serious accident.
Read More

The quickest way to get insured is through an existing policy

Check your paperwork: If you already have car insurance, your existing coverage might apply to your new car purchase for the first few days.
New car insurance grace periods
typically last from seven to 30 days, so you’ll have plenty of time to drive home and add your new vehicle to your policy.
If you don’t already have a pre-existing policy, many car insurance companies offer
same-day insurance
when you purchase a new policy. You may also have the option to purchase
temporary car insurance
from the dealership. Dealership car insurance lasts about 28 days, giving you a generous amount of time to secure permanent coverage. But beware—premiums are often sky-high.

The cheapest way to get insured is to compare car insurance quotes

The
Jerry
app streamlines the process of getting same-day coverage—it takes less than two minutes to sign up. Almost instantly, you’ll be able to browse personalized quotes from dozens of insurance companies. You can also customize your coverage levels right in the app, so it’s fast and easy to get exactly the policy you need. 
Are you overpaying for your car insurance?
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FAQ

Do you need to get car insurance before picking up a car at the dealership?

Most dealerships ask for proof of car insurance before letting you drive a new vehicle off the lot. They also offer short-term car insurance, but it’s expensive, so it’s better to arrive with an insurance policy already in place.

Do I need car insurance to buy a used car?

Even if a private seller doesn’t ask for proof, driving uninsured is illegal and you need auto insurance to take a newly purchased used car home.

How do I get proof of insurance?

Your auto insurance provider will mail you an insurance card shortly after you’ve purchased coverage, and in most states, you’ll also get a digital copy. If you’ve lost your card or need
proof of insurance
quickly, ask your provider for your policy number or a letter confirming your plan.

How much insurance do you need for a car loan?

Banks often require customers to purchase a
full coverage car insurance policy
, which includes the
minimum coverage required in your state
plus
comprehensive
and
collision coverage
.

What’s car dealership insurance?

Car dealerships may offer temporary coverage to customers looking to get their car home, but these policies are generally over-priced.

Meet our experts

avatar
Jasmine Kanter
Jasmine Kanter is a non-fiction writer specializing in comprehensive content that's accessible to beginners, experts, and everyone in between. Since joining the Jerry team, Jasmine has penned over 300 articles on car insurance requirements, driving tips, and car maintenance.
Prior to joining Jerry, Jasmine worked as a graphic designer, storyboard artist, and French customer service representative. She enjoys collecting hobbies and babysitting ducks in her spare time.
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Amy Bobinger
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Licensed Insurance Agent — Expert Insurance Editor
Expert insurance writer and editor Amy Bobinger specializes in car repair, car maintenance, and car insurance. Amy is passionate about creating content that helps consumers navigate challenges related to car ownership and achieve financial success in areas relating to cars.
Amy has over 10 years of writing and editing experience. After several years as a freelance writer, Amy spent four years as an editing fellow at WikiHow, where she co-authored over 600 articles on topics including car maintenance and home ownership. Since joining Jerry’s editorial team in 2022, Amy has edited over 2,500 articles on car insurance, state driving laws, and car repair and maintenance.

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