As you may be aware while registration is still in your name in Pennsylvania you need to have car insurance on the vehicle. A lapse can give you penalties such as a suspended license and registration.

In fact if Pennsylvania Department of Transportation (PennDOT) finds your auto insurance has lapsed for over 31 days you will have your vehicle's registration suspended for 3 months. If you are found to have operated the vehicle without insurance your license will be suspended for 3 months as well.

The vehicle's registration plate, sticker, card and your driver's license must be surrendered to PennDOT in order to serve the suspension. Restoration fees of $50 and proof of valid insurance must be submitted prior to the time your registration and/or driving privileges are to be returned.

Also as the car owner, while the title is in your name still, you have vicarious liability for those that operate the car, so if this person buying the car was in an accident and there is no insurance on the car to cover it then you, as the car owner, as well as the person you sold the car to could be held responsible and sued.

Once the title is signed over to the other party you will still need to make sure that he goes and registers the car in his name and you get it out of your name so that you cannot continue to have liability for the actions of the new owner. PennDOT has information on their Vehicle and Drivers site that can help motorists that are buying and selling cars understand the process. If you have not yet signed over the title to the buyer then you may want to contact this state agency to see how to protect yourself and if you will be receiving any penalties for cancelling insurance on the vehicle before the title transfer.

Without having insurance on the vehicle we cannot offer advice on how to protect yourself since you could be liable as the car owner if the buyer did cause an accident while the car was still titled in your name. If PennDOT cannot advise you of a way in which to protect yourself you may need to seek legal advice. An attorney would be able to give you more comprehensive information on PA laws regarding this situation and also if you could be penalized if the buyer does have a suspended license and is found driving your car.