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UPDATED: Mar 13, 2020
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Auto insurance laws vary from one state to the next. Because of these variations, it’s important to always maintain an auto policy for the state where you will be using the vehicle. Failure to carry proper insurance could lead to legal troubles with the DMV and might lead to a suspended license due to insufficient insurance coverage. For people moving to a new state, transferring auto insurance is a necessary step of the move.
Every state sets its own required insurance coverage. In some areas, the limits of liability are substantially lower than others. If a person moves from a state where liability limits are only $5,000 to a state where the limit is $25,000, he can be fined for carrying insufficient car insurance and may even face a suspended license until the insurance policy is corrected.
Some states also have specific laws governing the application of coverage; for example, some states carry uninsured motorist coverage that can protect a driver from someone without insurance, while other states do not have this coverage. There are also some states that require a driver to pay his own medical expenses out of his car insurance policy when injured in an accident, while other states enable drivers to pursue legal action against the at-fault party in an accident.
As a rule, car insurance companies will base the application of coverage on the state laws of the policy state, rather than the state where the accident occurred. If a person lives in a different state from his insurance policy, he could be found guilty of insurance fraud. This would lead to claims denials and canceled insurance coverage; depending on the circumstances, it could also lead to legal action being taken against him.
How long after I move do I have to get a new driver’s license?
Whenever someone moves to a new state, he must obtain a driver’s license and vehicle registration for that state within 30 to 90 days, depending on the state’s laws. Students and transient workers are excluded from this as they maintain permanent addresses elsewhere, but all other new residents to a state must follow this law or risk legal action.
Getting a new license is usually quite easy. The driver must take an eye exam and have a simple background check completed; he may also need to complete a written driving exam. After the necessary fees are paid, the new license should be available within a few weeks.
Registering a vehicle may be slightly more complicated, depending on the destination, as some states have more stringent emissions requirements than others. A driver must have his vehicle inspected and certified with an emissions test; if the vehicle passes, the paperwork can then be provided to the DMV and the new registration can be processed. If the vehicle does not pass, it will need to be repaired to the emissions standard.
How do I buy car insurance in my new state?
Most major car insurance companies are available in all states. In order to transfer coverage to a new location, the insured simply needs to call the company and provide the date and destination. The customer service representative will discuss any necessary changes that might occur in the policy, such as an increase in liability limits, and will also provide information about rate changes. Depending on the destination, insurance premiums may actually decrease when the policy is transferred to a new state. If the policy will go up in price, the agent can make suggestions for reducing the cost without sacrificing necessary coverage.
The insurance policy can be transferred at any point in the moving process. Be aware that the insurance company will report to the local DMV, so it’s best to have the vehicle registered as quickly as possible after the change in insurance becomes effective. Nearly every state will give a new resident at least 30 days to complete the necessary paperwork, so there is no rush to change insurance and registration immediately during a hectic move.
If you handle your car insurance online or over the phone, the customer service department should be the same regardless of where you live. If you prefer to have a local agent, you can ask your current agent if he has any recommendations or can refer you to a local agency where you will move. Otherwise, you can shop around in town for a new agent who will suit your needs.