How To Get Car Insurance for Your New Car

Written by  Rob Bhatt

Edited by  Naomi Barr

+ 1 More

Updated Oct 23, 2026 Content was accurate at the time of publication.

How does insurance work when buying a new car?

You usually need full coverage Full coverage includes collision and comprehensive, which cover your own car for damage and theft. car insurance to drive a new car you’ve financed off a lot. Your lender will make you get it to protect its interest in your vehicle.

If you already have full coverage, your existing policy covers a new car temporarily. These grace periods typically range from seven to 30 days, depending on your insurer. This gives you time to see how the new car affects your rate and shop for a better deal.

If you only have minimum coverage Minimum coverage usually includes liability insurance, which covers injuries and damage you cause to others. Some states require additional coverage. , you can usually call your insurance company to add full coverage to your policy.

Car insurance for first-time buyers

If you don’t already have car insurance, you can usually set up a policy ahead of time or while you’re at a dealership.

Most companies offer same-day car insurance or advanced purchasing by phone or online. You usually need to provide:

It’s usually better to shop for auto insurance before you get to the dealership. This gives you more time to compare car insurance quotes to find the cheapest rate.

When you shop early, you can usually get quotes based on the year, make and model of the car you plan to buy. You’ll get a more accurate estimate by providing the car’s VIN, if you have it.

How to get car insurance for a new used car

The steps for insuring a used car are similar to those for a new car. If you’re financing a used car, your lender will make you get full coverage, if you don’t already have it. 

No one can make you get full coverage if you pay for a new or used car outright without any financing. Instead, you usually just need your state’s minimum liability coverage to legally drive the vehicle home. Liability covers injuries or damage you may cause to others, but not your own injuries or vehicle damage.

Best companies for insuring a new car

Travelers and Progressive are among the best car insurance companies for new vehicles. Both offer useful coverage options for newly purchased cars, including used vehicles. State Farm is a good company for cheap rates without many extras.

Best insurance coverage for new cars: Travelers

Average monthly full coverage rate: $135

LendingTree rating: 5/5

Why we chose it: Travelers has the cheapest rates among major car insurance companies. It also offers gap insurance Gap insurance covers the difference between your car’s value and your loan balance, if you total the vehicle. and new car replacement coverage If your car is totaled while it’s relatively new, new car replacement pays for a new one. . Each can come in handy in some situations for a newly purchased car.

Who it’s best for: Most new car owners. Travelers’ new car replacement pays to replace your vehicle with a new one if it’s totaled within its first five years. This makes it easier for you to get back into a new car after an accident. Its gap insurance can come in handy if you finance your car with a low down payment. 

PROS

• Cheapest car insurance rates among major companies
• Offers gap insurance and new car replacement
• Has several discounts to make your rate more affordable

CONS

• State Farm is cheaper after a ticket or accident

Read Review

Best online car insurance for new cars: Progressive

Average monthly full coverage rate: $160

LendingTree rating: 4.5/5

Why we chose it: Progressive’s user-friendly website makes it easy to buy your policy while you’re in a dealership. It has affordable rates in most states and offers gap insurance.

Who it’s best for: Online shoppers. It only takes minutes to set up a new policy on Progressive’s website. Some of the other companies with online quotes make you finalize your purchase with an agent. Progressive also offers a form of gap insurance called loan/lease payoff, but it doesn’t offer new car replacement. 

PROS

• Easy online purchasing
• Full coverage rates are 10% less than U.S. average
• Offers gap insurance

CONS

• Doesn’t have new car replacement

Read Review

Best for new car buyers with a ticket or accident: State Farm

Average monthly full coverage rate: $144; $156 (after a ticket) or $163 (after an accident)

LendingTree rating: 4/5

Why we chose it: State Farm is often cheaper for drivers with a bad driving record than many other companies. This can make it a good deal if you’re getting a new car after a recent ticket or accident.

Who it’s best for: Drivers who don’t care for extra coverage. State Farm generally has affordable rates for drivers with a clean record or just a minor blemish. However, it doesn’t offer new car replacement or gap insurance. If you’re not interested in either, State Farm may be a good fit for you. 

PROS

• Drivers with a clean record pay 19% less than the average
• Cheap rates after a ticket or accident
• You can start a quote online

CONS

• Doesn’t offer gap insurance or accident forgiveness

Read Review

Monthly car insurance rate comparison

How much car insurance do I need for a new car?

Full coverage is usually worth getting for a newly purchased car worth more than $5,000, even if you pay in cash.

Full coverage includes collision Collision covers damage to your car from a collision with another vehicle or object. and comprehensive Comprehensive covers your car for theft and damage from non-collision causes, like fire, flood and vandalism. . Both:

If your car is worth less than $5,000, full coverage likely won’t pay much after your deductible. So if you buy an older car with cash at a low price, it may not be worth it to pay for full coverage. 

How much liability insurance should I get for a new car?

You only need to meet your state’s minimum liability insurance requirements to legally drive your new car. However, the minimum requirements in most states don’t typically provide enough protection.

If you don’t have enough liability to cover an accident victim’s expenses, you can be held personally responsible for the shortfall. This can put your savings or other financial resources at risk.

In many states, the minimum liability limits start at $25,000 for each person you injure in an accident. It usually doesn’t cost too much to increase this to $50,000 per person. Higher limits are good if you have more savings and investments to protect.

Is new car replacement coverage worth it?

New car replacement coverage can be worth it for the peace of mind it provides. Cars tend to lose their value fast. If your new car is totaled or stolen after a year or two, your insurance check may not cover the full cost of a new model. New car replacement covers this shortfall.

New car replacement usually doesn’t cost much to add to your policy, but it’s not required by law or lenders.

Should I get gap coverage?

Gap insurance may be worth getting if you finance your car with a low down payment or long-term loan.

If you total your car in the early years of a loan, your insurance payment may not be high enough to fully pay off your loan. Gap insurance protects you from having to cover a shortfall like this out of your own pocket.

Many car insurance companies offer gap coverage as an add-on that you can remove at any time. This makes it easy to cancel the coverage after a few years, when you may not need it anymore.

Lenders and dealers offer a similar form of coverage known as a gap waiver. These waivers usually last for the life of a loan, through some let you cancel early for a partial refund.

How to get insurance before buying a car

It’s pretty easy to get insurance before you buy a car. To get quotes, you usually just need to provide:

If you have narrowed your car search to a few vehicles, you can get quotes for each of them to see which one is cheapest to insure.

You typically need to make a partial or full payment and provide a VIN to activate your policy. You can do this while you’re at a dealership or in advance, after you confirm your purchase details.

How long does it take to get car insurance?

You can often get car insurance in less than half an hour. Many companies offer online quotes and let you activate your policy within minutes.

It may take longer if you’re a first-time buyer, because some companies don’t insure drivers without prior coverage. The same is true if you have a bad driving record.

Regardless of your situation, it’s usually worth taking a little extra time to compare quotes from a few companies. This will help you find the cheapest rate.

How LendingTree helps you compare car insurance quotes

Shopping for car insurance isn’t always straightforward — especially when rates and availability vary widely based on your location, vehicle, driving history and coverage choices. LendingTree makes it easier to compare options from multiple insurers, so you can find a policy that fits your needs and budget.

Methodology

How LendingTree obtains car insurance rates

LendingTree’s insurance rate data comes from Quadrant Information Services and is based on publicly sourced insurance company filings. The average rates that we list are drawn from an analysis of hundreds of thousands of car insurance quotes. 

Prices are shown for comparison purposes only, and they don’t guarantee exactly what you’ll end up paying. Your own rates may be different based on factors like your age, driving record, credit record and the value of your car. Terms and conditions apply.

Our average car and driver

The vehicle and the person driving affect how much the insurance will cost. Older drivers tend to pay less for insurance, as do those with good driving records. Meanwhile, expensive cars will generally cost more to insure.

For all the rates on this page (unless noted otherwise), we quote the cost of a full coverage policy for a 30-year-old driver with good credit and a clean driving record who drives a 2021 Honda CR-V LX.

Our typical coverage limits

Your coverage and deductible have a big effect on your insurance costs. LendingTree generally quotes two different types of coverage:

For full coverage policies (including collision, comprehensive and liability), we use these coverages:

For minimum coverage policies, we use whatever the state’s required minimum limit is or an average of the state rates for national prices.

How LendingTree evaluates car insurance companies

To develop LendingTree ratings, our team of insurance experts score insurance companies based on several categories:

LendingTree weighs each of these categories based on what we think customers value in an insurance company. See our full car insurance ratings methodology for the details.

The third-party customer service ratings include Complaint Index scores from the National Association of Insurance Commissioners (NAIC) and financial strength ratings from AM Best. 

NAIC Complaint Index scores are used to see how satisfied customers are with their claims, while financial strength ratings from AM Best reflect the ability to pay out claims.

See LendingTree’s full editorial guidelines for more information.