Buying a new or used vehicle can be exciting. After you’re done selecting the perfect set of wheels, you’ll need to focus on the less-exciting part: getting insurance for your new vehicle.

The state you live in will require you to carry a minimum amount of car insurance. And if you finance or lease your new vehicle, the lender will require you to carry sufficient insurance to protect its investment as well.

In some cases, you may be able to add your new car to your current policy. But if you didn’t trade or sell your former vehicle, you’ll need to add the new car to your existing policy or set up new coverage elsewhere.

Below are helpful tips on how to insure a car that’s new to you. You’ll also discover how to compare car insurance coverage options and find the best deals for your situation.

Can you switch insurance to a new car?

When you buy a new vehicle, your existing car insurance should cover it at first — usually with the same level of coverage you have on your old car. This is known as the grace period. For this reason, an auto dealership may allow you to drive a new purchase off the lot if you show proof of current insurance and sign a form committing to insure the vehicle.

Yet even in this scenario, you won’t have long to get a new policy in place.

If you want to stick with your existing insurer, you should notify your insurance company as soon as possible after purchasing a vehicle. Some insurers may give you a grace period to add a new vehicle to your policy (such as if you buy a new car over the weekend). But if a grace period isn’t available, you’ll need to add your new car to your policy before leaving the dealership.

If you trade in or sell your old car, you may be able to transfer your existing insurance coverage to your new vehicle. But remember to review the coverage options on your existing policy before making the change. Your former selections may not be the right fit for your new car. So it’s important to reassess how much car insurance you need now.

It’s also wise to compare insurance quotes, policy options, and potential insurance discounts from several different providers. Rate shopping can help you make sure you’re getting the best deal for the type of coverage you want. What you pay for a policy will also be influenced by some personal factors, including your gender, marital status, location, and even your credit history.

If you’re confident that your current provider is offering a rate and amount of coverage that makes sense for your new vehicle purchase, you can move forward.

When you transfer coverage to a new vehicle, your premium will likely change since the value of your new vehicle will differ from your old one. This is true even if you don’t adjust coverage amounts. Of course, if you change the types of insurance you carry (e.g., adding comprehensive car insurance when you had only liability coverage before) or the deductible on your insurance policy, those adjustments will affect your premium as well.

Insuring a new car without previous coverage

Some drivers may need to establish brand new car insurance when purchasing a vehicle. If you’re in this position, it’s important to secure adequate insurance before you drive your new car for the first time — even if you’re paying in cash. If you drive without car insurance, you could put yourself at risk financially or worse, be in violation of state laws.

How to get car insurance before you buy a car

It’s illegal to drive without insurance. But you can set up insurance coverage before you own a vehicle, such as a non-owner policy or insurance for the type of car you plan to purchase.

As an alternative, you could also apply for a temporary car insurance binder before you purchase a new vehicle. A binder is a document you request from an insurer that serves as proof of insurance to lenders. This document can also satisfy legal insurance requirements until your formal auto policy is approved.

When you contact an insurance agent and reach out to carriers directly to set up coverage for the first time, the car insurance quotes you receive will vary based on the type of coverage included. Here are some of the most common coverage options:

• Liability insurance pays for damage you cause to other vehicles along with medical expenses for drivers and passengers when you’re at fault in an accident. In almost all states, you need a minimum amount of liability coverage to legally drive.

• Comprehensive insurance is optional coverage that pays for certain types of damages to your personal vehicle that don’t involve a collision (e.g. theft, vandalism, storm damage, etc.). If you finance or lease your vehicle, the lender will typically require you to carry this type of coverage.

• Collision insurance can cover the cost of repairing or replacing your personal vehicle if someone steals it or you’re in an accident. If you finance or lease your vehicle, the lender will typically require you to carry this type of coverage.

• Personal injury protection (PIP) insurance can help pay for medical bills for yourself and your passengers in the event of a covered accident.

• Full coverage car insurance is an unofficial term to describe an auto insurance policy package including liability, comprehensive, and collision coverage — sometimes more. In states where it’s required by law, full coverage also includes uninsured motorist coverage that kicks in when you’re in an accident with someone lacking enough coverage.

The effective date of your new insurance typically begins as soon as you make your first payment. (Note: Depending on the date you purchase your policy and the insurer’s requirements, you might have to make two months worth of premium payments upfront.)

Tips for getting the best car insurance for your new car

Insuring a new vehicle may feel overwhelming in this era of soaring car insurance costs. These tips can help you make sure you get the coverage you need while keeping your insurance costs down.

• Shop around: Whatever type of insurance you decide to buy, it’s smart to get quotes from multiple insurance companies. Comparing auto insurance quotes (just as you should during the car shopping process) can be a great way to find affordable car insurance.

• Assess your coverage needs: Your insurance needs for a new car may differ from an older vehicle. Consider the value of your new vehicle (or the vehicle you plan to purchase) and how you plan to use the new car. A car you drive every day may require different coverage than a vehicle that will sit in your driveway most of the time. (Vehicles used in ridesharing have additional requirements.)

• Understand your state’s minimum car insurance requirements and coverage limits: Most states require you to carry basic liability insurance that covers other drivers if an accident takes place. But state minimum coverage limits (often noted as 25/50/25, or at least $25,000 per person you injure, $50,000 in injuries per accident, and $25,000 in property damage per accident) may not be enough to financially protect you in a major accident.

• Determine whether you need gap insurance: If you finance or lease your new car, your lender will probably require you to have gap insurance, which covers the gap between what the insurer would have to pay for your totaled or stolen vehicle and what you still owe on your auto loan. It’ll cost you a bit extra but save you from having to lay out cash for the balance of your loan if your car were totaled in an accident.

• Consider additional coverage: If you finance or lease your new car, the lender will require you to carry comprehensive and collision coverage. But even if you pay cash for your new purchase, you may want to consider adding on this additional coverage to protect your own financial investment. Extra features like roadside assistance, rental car reimbursement are also nice to have.

• Look for discounts: Many insurance companies offer discounts that can save you significant money. Bundling coverage (using the same company where you have homeowners or renters insurance), taking a defensive driving course, getting credit for good grades, or signing up for a telematics device to track your mileage are all discount opportunities. It’s also a good idea to look at the customer satisfaction ratings of any company you consider.

Important documentation and information your insurer needs

When you set up new car insurance (or switch your existing coverage over to a new vehicle), your insurance company will need some basic information, such as:

• Vehicle identification number (VIN)

• Title information

• Financing or leasing details

• Driver’s license

• Vehicle inspection or appraisal (in certain circumstances)

If you’re establishing a new insurance policy, the insurer may also review your credit (depending on your state of residence). In many states, your credit-based insurance score can impact the price you pay for auto insurance. Good credit has the potential to lower your car insurance rates while bad credit could make it more expensive to insure your vehicle.