What happens to your car insurance when you sell your car?

When you plan to sell your car you should notify your insurance company of the pending sale. It will provide you with instructions on how to transfer title properly, surrender the plates and cancel the insurance if you aren't transferring the coverage to a new car. Generally, the insurance company won't cancel the insurance until the plates are turned in or transferred to another vehicle through the RMV. That means the company will continue to bill you until the transaction is properly completed.


If the insurance was paid for and the policy is cancelled during the coverage year the company will issue a refund based on their own calculations.