Thinking about selling your car, truck or SUV? Don’t cancel your auto insurance just yet. Find out the right time to end your vehicle’s coverage so that you’re financially protected.
Can I cancel my auto insurance before I sell my car?
No. If you cancel your auto insurance coverage, you’ll have to pay for damage that happens while it’s still in your name and any accidents that may happen during test drives.
Texas law requires drivers to prove they can pay for any accidents they cause regardless of whether the car they’re driving is for sale.
Should I cancel my auto insurance after I transfer the title to the buyer?
Contact your insurance company to remove the vehicle from your policy when the sale is final, the title has been transferred, and you’ve filed a vehicle transfer notification with the Texas Department of Motor Vehicles (TxDMV). After you file the notification, you won’t be responsible for the buyer’s parking tickets or toll violations.
What else should I know when selling my vehicle?
- You need insurance while you’re trying to sell your vehicle even if you aren’t using it.
- Comprehensive and collision coverage protects you from theft or damage before the sale is final, as well as damage if an accident happens during a test drive.
- Liability coverage protects you from damage caused to others during test drives.
- Keep all sale documents so you can confirm the insurance cancellation date.
