Do you need to show proof of insurance at a car dealership when buying a used car?

Absolutely. Even if you pay cash for the vehicle you will need to prove that you have liability insurance in order to legally drive off the lot. If you are financing the vehicle you will have to show that you have liability and physical damage coverage before driving off the lot. The dealer will contact your insurance agent to verify that the coverage is in force and will add the vehicle to your policy with the coverage that they require and that you want.