When financing a vehicle from dealership and involved in accident while still under dealership insurance , dealership is required libility insurance?

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Aug 2, 2011

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Insurance Question from Eagle Rock, CA

Asked on 08/02/2011

When financing a vehicle from dealership and involved in accident while still under dealership insurance , dealership is required libility insurance? I bought a car and literally 3 days after I was involved in an accident(not at fault). Car was still covered by dealership until day 4, which by then I had my own insurance. DmV sent letter a month later stating my liscense to be suspended due to not having liability during accident. Is the dealership allowed to not provide adequate coverage for buyers? what if I had got in an accident when test driving? My dealership said the car was covered, but did not explain the limitations. How do I keep my license from getting suspended and what actions should I take?

Answer given on August 06, 2011

It is not clear if this is your first car or if you had/have insurance on another car. If you had insurance on another car then your insurance company usually gives you 5-15 days to report a new purchase. You would then need to ask your insurance agent to help you send proof of insurance to the DMV. The form, SR-1, should be available from your agent.If you did not have an existing insurance policy, then the dealer should have been clear as to whether or not they covered the car for liability and physical damage. You need to speak with the dealership to see if their insurance included liability insurance. If not, then you need to try to work with the DMV explaining the situation. Make sure they understand that you do have insurance in force as of the date of the policy. The DMV may require a filing with them proving the insurance. This is available from your insurance company, at a cost.

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