Black Friday isn’t just for TVs and laptops anymore. Car dealerships have figured out that November is prime time to move inventory, and the deals can be legitimately good.
Zero percent financing, cash back, end-of-year clearance pricing, it’s tempting. But here’s what most buyers don’t think about until they’re sitting in the finance office: insurance.
And if you’re not prepared, that shiny new car could end up costing you a lot more than the sticker price suggests.
Don’t Drive Off the Lot Without Insurance
First things first, you cannot legally drive a new car off the lot without insurance. Most states require proof of coverage before the dealer hands you the keys.
The good news? If you already have an active car insurance policy, you typically have a grace period to add your new vehicle, usually between 7 and 30 days depending on your insurer.
But don’t gamble on it. Call your insurance company before you finalize the purchase. Some carriers require immediate notification, and if you assume you’re covered and you’re not, you’re driving uninsured.
That’s a criminal offense in most states, not to mention financial suicide if you have an accident.
Understanding Coverage Requirements: Leasing vs. Buying
Here’s where it gets tricky: leasing versus buying. If you’re financing or leasing through the dealership, they will require full coverage—liability, collision, and comprehensive.
You don’t get a choice. Lease agreements often have even stricter requirements, including higher liability limits and lower deductibles. It’s their car, not yours, and they’re not taking chances.
If you’ve been driving with just liability coverage on your old beater, expect your premium to jump significantly.
Gap Insurance: Don’t Pay Dealer Prices
But the real kicker is gap insurance, and this is where dealers make a killing. Here’s what gap insurance does: if your brand-new car is totaled or stolen, your regular auto insurance only pays what the car is worth at the time of the loss, not what you owe on the loan.
Cars depreciate fast, some lose 20% of their value the moment you drive off the lot. If you owe $30,000 but the car is only worth $24,000, you’re stuck paying that $6,000 difference out of pocket. Gap insurance covers that shortfall.
Dealerships will try to sell you gap insurance on the spot, often at inflated prices. Don’t bite. Many car insurance companies offer gap coverage as an add-on for a fraction of the cost. Check with your insurer first before signing anything at the dealership.
At QuoteScouts, we’ve seen too many drivers get burned by assumptions. A great deal on a car isn’t great if your insurance costs wipe out the savings.
Do your homework, understand your coverage requirements, and make sure you’re protected before the paperwork is signed. Black Friday deals come and go, but insurance mistakes stick around.
