What should I do with my insurance if I sold my car?
The moment you get a car in your name, you also have an insurance obligation. Once the car is sold, you can terminate the insurance. How do you do that and what happens to the car insurance?
As the owner of a car, you are required to have at least third-party liability (TPL) insurance on the car. Even if the car is not on public roads, you still have an insurance obligation. Checking this is simple. Insurers provide data on which license plates they have insured. This file can be compared with the file showing who has which license plate in their name. Does a license plate not appear in both files? Then something is wrong. If your car has been sold, the link between your name and the license plate will be broken. As of the sale date, you can terminate or suspend the insurance.
What happens when your car is sold?
After your car is sold, you will receive a release certificate. With this you can prove that the car is no longer in your name. The insurance obligation now lies with the new owner. With the indemnity certificate you can terminate or suspend your car insurance. Which of the two options you choose depends on your own preference. We explain the options below.
You buy another car in the short term
You can temporarily suspend auto insurance. This means that the insurance is frozen as of the sale date. You no longer owe a premium and the premium that has been paid remains in the policy. As soon as you register another car, the insurance becomes active again. The advantage of this is that the insurance does not have to be terminated and reapplied for again. In addition to convenience, it also provides a financial benefit. This is because the policy cost is lower. A disadvantage is that you put the new car back on the same insurance policy. By comparing, you may be able to find a cheaper insurer with similar or even better policy terms.
You are not buying another car in the short term
You have sold your car, so you can terminate the insurance. The insurer will refund the overpaid premium. You will receive a new policy document which shows that the car insurance is terminated as of the date of sale. This also shows how many claim-free years you are entitled to. You can use these again as soon as you start insuring a car in your name again. Keep in mind that the accumulated claim-free years are only valid for a limited time. After one or several years (this varies per insurer) the accrued claim-free years expire.
Have you sold your car, but have multiple cars in your name? It might be an option to use the accumulated claim-free years for this car insurance.
Also read:
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