Can I Cancel Car Insurance If I Sell My Car?

Selling a car can be quite the process, from ensuring that all paperwork is in order to getting the best price for your vehicle. But what about your car insurance? If you have an active policy that you no longer need due to the sale of your car, can you cancel it? The answer is yes, but there are a few things to consider first. 

In this blog post, we will go over everything you need to know about cancelling car insurance when selling a car. We will discuss the specifics of cancellation policies, ways to save money on premiums, and more. So if you’re looking for information on how to handle your auto insurance during a vehicle sale, keep reading!

What to do When You Sell Your Car

If you’ve decided to sell your car, congratulations! Once you’ve gone through the process of finding a buyer and transferring ownership, you’ll need to take care of a few final details. One of those is cancelling your car insurance.

To cancel your insurance, contact your insurance company and let them know that you have sold your car. They will likely ask for the date of the sale and the name and address of the new owner. Be sure to keep any documentation related to the sale handy in case they have any questions.

Once you have confirmed that your insurance has been cancelled, be sure to remove any physical evidence of it from your car. This includes taking off your insurance decal (if applicable) and destroying your insurance card. You don’t want the new owner to be liable for any accidents that occur after they take possession of the vehicle.

And that’s it! Once you’ve cancelled your insurance and removed all evidence of it from your car, you can rest assured knowing that you’re no longer responsible for what happens to it.

How to Cancel Your Insurance Policy

If you’re selling your car, you may be wondering if you can cancel your insurance policy. The answer is yes, but there are a few things to keep in mind.

First, if you have a loan on your car, you’ll need to maintain insurance until the loan is paid off. Your lender will require you to have comprehensive and collision coverage, so cancelling your policy could put you in violation of your loan agreement.

Once your loan is paid off, you can cancel your insurance at any time. However, it’s important to keep in mind that most states require drivers to maintain liability insurance. So if you cancel your policy and don’t replace it with another one, you could be breaking the law.

If you’re not sure whether or not you need insurance, it’s always best to err on the side of caution and maintain a policy. That way, if something happens while you’re driving uninsured, you won’t be held responsible for any damages.

Reinstating an Insurance Policy

There are a few things to keep in mind if you find yourself in a situation where you need to reinstate your car insurance policy. The first is that you will likely be required to pay any outstanding premiums that were unpaid at the time of cancellation.

 The second is that you may be subject to a lapse in coverage, which could result in higher rates. And finally, you will need to provide proof of insurance to the DMV before your registration can be reinstated.


Selling your car and canceling your car insurance go hand in hand. Canceling your auto insurance will help you avoid paying for unnecessary coverage, but it is important to make sure that you do so properly and in accordance with the law.

Make sure to contact your provider to find out what steps are necessary for the cancellation of your policy, such as informing them of when you sold or disposed of the vehicle. Doing so will ensure that all applicable fees have been paid and that there are no lingering liabilities on either side.