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Grace period in getting insurance in Texas


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Question: Is there a 30 day grace period in Texas, during which time you can get your car insured? Or must you have it insured as soon as you purchase it?

Answer: If you are buying a car for the first time and do not already have insurance in place to add the vehicle to, then normally in Texas you will need to buy an insurance policy and get proof of it just to drive off from the dealership's lot. Texas law (Texas Motor Vehicle Safety Responsibility Act in Transportation Code 601.051) states that a person may not operate a motor vehicle in this state unless financial responsibility is established for that vehicle, so there is no grace period in which to get insurance in TX.

According to the Texas Department of Insurance (TDI), if you are buying another car to add to your current auto insurance policy than that policy might automatically cover it with certain limitations. Insurance companies' policy terms differ so read your policy to find out whether it automatically covers an additional or replacement car.

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The TDI states that in general, an additional car usually has the same coverage as the car on your policy with the broadest coverage. For example, if you have two cars - one with liability insurance only and one with liability, collision, and comprehensive coverages - and you buy a third car, the third car will automatically have liability, collision, and comprehensive coverage.

A replacement car usually has the same coverage as the car it replaced. For example, if you trade in an older car that only had liability coverage; the new car will automatically have only liability coverage.

Be sure to tell your insurance company as soon as possible that you have added or replaced a car and which coverages you want. You could lose coverage on an additional or replacement car if you wait longer than the number of days specified in your policy to notify your insurance company.

Since insurance companies' guidelines and policy terms differ so widely regarding adding a new car and if it will automatically be covered for a certain time period or not before buying a car, you should contact your insurance company to see if you have coverage for a certain amount of days or if you need to immediately inform them to have coverage. Before driving off in the new car though you will need to make sure it is insured or you will be breaking the law in TX.


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