When you buy a new car, you must arrange insurance coverage before you can drive it legally. However, this isn’t as simple as changing the car’s details on the policy, as many factors are considered when calculating an insurance premium.
In this article, we answer the most commonly asked questions about transferring car insurance and explain how car insurance works when you buy a new vehicle.
Can I drive my new car home using my old car’s insurance policy?
No. In the UK, it is a legal requirement to ensure the car you drive is currently insured. Your current policy will only cover you to drive the vehicle assigned to that policy, meaning your new car will be uninsured until you take the necessary steps to insure it.
Can I transfer my car insurance to another car?
The answer to this is yes. Almost all UK car insurance providers allow you to transfer your current car’s policy to a new car. However, this could change the price you pay for your premium.
Will I have to pay more for my insurance premium on a new car?
There’s no one-size-fits-all answer to this question, as many factors are considered when calculating your insurance premium. Depending on your car’s engine size, make, model, and its value, you could either see a reduction or an increase in your insurance premium.
How does car insurance work when I buy a new car?
Once you have purchased your new car, you must insure it immediately before driving it away. When you buy a new car, you can choose to either:
- Cancel your current policy and take out a new policy for your new vehicle.
- Transfer your new car’s details onto your existing policy.
Whether you decide to cancel your policy and buy a new one or change your current policy to include your new car’s details, you will need to speak to your insurer.
The insurance provider will ask you to provide information about your new car. This typically includes details like the vehicle’s make, model, year of registration, Vehicle Identification Number (VIN), and declare any safety features, modifications or anti-theft devices installed in the vehicle. The insurer will then use this information to calculate your premium.
You can pay the premium in a lump sum or monthly instalments, depending on your insurer’s policies.
Once you have transferred your insurance onto your new car and received confirmation from your insurance provider, you can legally drive it on public roads. Make sure to always have your insurance documents on hand, as you may need them in the event of an accident or during a traffic stop.
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.