DO I NEED CAR INSURANCE BEFORE BUYING A CAR?
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Do I Need Car Insurance Before I Buy a Car?
The process of buying a new car is often a lot of fun. It’s exciting to test drive cars, or imagine yourself behind the wheel of a model you’ve dreamed of owning. And car dealerships have worked hard to make the purchasing process smooth and easy. However, what about that moment after you’ve signed the paperwork, and you are about to drive off the lot? Do you need insurance to buy a car?
Do You Need Proof of Insurance Before Buying a Car in Canada?
If you’re wondering, “Do I need car insurance before I buy a car?” The answer is no. You don’t. You can complete the purchase transaction without having any insurance in place. This is true for both private sales (from one individual to another) and sales from a dealership. Where it gets tricky is when you’re about to drive the car off the lot.
Once the car is yours, you need to register it with the government. In order to do so, you need to have car insurance. It’s illegal to drive an uninsured car in Canada, so you need to have some form of insurance before you get behind the wheel. Luckily, you can use your previous car’s insurance for a grace period of six to fourteen days while you are registering and insuring your new vehicle. If you drive while under this grace period, you’ll need to have your sales documentation and your proof of insurance (from your previous vehicle) available at all times. If you don’t, you may incur a fine, and a serious driving violation might go on your permanent record.
Many dealerships have insurance brokers and registration officials on-site. These people will guide you through the process of filling out the necessary forms for both registration and insurance. However, if you’re buying through a private sale, you’ll need to do the legwork yourself.
To put it simply: do you need car insurance to buy a car? No. Do I need proof of insurance to drive in Canada? Yes.