Buying a car without insurance is a big no-no. However, before you make the purchase official and put your name on the vehicle title, the car is still under the dealership’s or seller’s car insurance.
If you’re browsing the market and test driving, your lack of car insurance shouldn’t keep you from doing so. Test driving is one of the only circumstances where a truly uninsured driver can drive without personal coverage.
In this post, we ask and answer why, along with tips on getting the best car insurance for new drivers who usually shop for cars with no insurance yet.
Who’s Car Insurance Covers Test Drives?
When a car is on a dealer’s lot and unsold, it is their responsibility to insure it until it gets sold. They usually do this with commercial auto insurance or inventory auto policy, which provides basic coverage for each one of their cars.
Since test drive vehicles are still their property, insurance responsibility falls onto them. Because a commercial new or used automobile is not registered and titled as a personal vehicle, it needs specialized garage liability insurance customized for such businesses.
When a lot’s vehicle is damaged or when a third party suffers losses or injuries while the lot car is being driven, the insurance that the dealer purchased will cover these events. Employees and customers who are test-driving vehicles on the lot are protected from liability and physical damage claims.
What if You Test Drive a Car From a Private Seller Rather Than a Dealer?
When purchasing a vehicle from a private seller, you do not have any stake in the automobile. While much the same, with a bit of variation in terminology, there is a significant distinction between commercial auto insurance and personal car insurance.
This is why it’s critical to verify with the owner that they are covered and have sufficient liability limits. There are rules to follow, but no one wants to get caught up in a years-long legal battle because they didn’t ask a simple question. Even if you are the one who is injured, the owner of the vehicle will be held accountable for any damages caused by a driver in their car.
What to Know When Test Driving a Car
After looking around a dealership’s lot and finding a vehicle that attracts your attention, it’s time to ask for the keys. It’s finally time to request the keys so you can drive the car.
Before you test drive a car, the dealer will request your driver’s license, which will be verified. Many purchasers must know that the sales agent begins qualifying you once the license is transferred. You can only buy vehicle insurance if you have a driver’s license. However, you must have a valid driving license for the dealer’s car insurance to cover you.
If you do not have insurance, you must obtain it before taking ownership of the vehicle. You may only acquire private insurance after you buy and finance the car.
Before you can depart, the finance employee will need a copy of your insurance cards. You can now buy insurance for the automobile to protect your assets and the bank’s property since you have an insurable interest in it. Always ask the car’s original owner if you are interested in their insurance coverage because while you are test-driving, that insurance becomes yours.
Insurance Navy can help you find the best car insurance coverage at the most budget-friendly price in just a few minutes. Get free cheap car insurance quotes online via our website or mobile app. Are you looking to speak to a representative? Call us at 888-949-6289 or stop in at one of our many locations.
