I'm looking for a new car. A friend of mine said it is a state law that my car insurance will cover the new car as long as I notify my agent within 30 days after I buy it. I called my agent, and she said I should let her know immediately. Is there a law that says I have 30 days?
This is a pretty common misconception. There is no statute or rule that requires a car insurance company to allow 30 days for you to notify them that you bought another car. Your policy language will spell out your company's requirements for a newly acquired car. A typical provision is 14 days, but only four days if you don't have physical damage coverage on one of the cars already insured. Your policy may be different, so we suggest looking through your policy for the specific provision, or asking your agent or customer service representative to guide you through it. We had a complaint recently, for example, for an auto policy with a provision that there was no coverage for a newly acquired vehicle unless all cars in the household were insured by the company.
We believe your agent is giving you good advice. The sooner you contact your agent or insurance company, the sooner you can be sure you have the coverage you need. Often a newly acquired vehicle is newer and you may want different coverage than you have on your existing cars. The reverse could also be true. You might be buying an older car that does not need the same coverage. It's also a good opportunity for you to review your coverage choices with your agent or company to be sure you have the best fit for your current situation. If you notify your agent or company by phone, it's a good idea to make a note of the date, time and the name of the person you talked to.
Thanks to Jan Vitus from our Rates and Forms Unit for the policy information.