Is it troublesome to buy insurance when buying a second-hand car? Two easy ways for lazy people to manage their insurance policies

Many people choose used cars when they buy a new one, drawn by their lower prices. However, some worry that their existing car insurance premiums won't be refunded after switching to a used car. If you plan to buy a used car, we recommend notifying your insurance company beforehand, as your premium may be adjusted if the model changes. This time, we've compiled a few steps to help you transfer or cancel your insurance policy after switching to a used car

Option 1: Cancel the policy and you can get a proportional refund of the premium paid

If you decide to buy a used car and cancel your current insurance policy, the first step is naturally to contact your insurance company. Canceling a policy is simple, but be aware that each insurance company has different terms and conditions for policy cancellation

Most insurance companies calculate and refund premiums proportionally based on the remaining months from the date of policy surrender. If the policy has been in effect for more than eight months, you will not receive any refund. If the policy has been in effect for less than one month, you may receive approximately 80% of the premium refund. The actual refund calculation depends on the insurance company's terms and conditions, so please pay close attention to this!

Additionally, be aware of No-Claim Discounts (NDCs) (discounts earned without any claims during the policy term), which are mostly calculated on a yearly basis. While many insurance companies accept the transfer of discounts to new policies, many only accept completed full-year contracts when calculating discounts. If you are trading in a used car, or if you only have six months left on your insurance policy and want to transfer it, the new insurance company may not recognize those six months of policy.

Option 2: Inquire with your current insurance company whether it is possible to change the insured vehicle

If a car owner wants to change the insured vehicle after trading in their old car for a used one, they must check with the insurance company for details, as the new vehicle's horsepower, engine, chassis, and production year differ from the original. Current regulations require car owners to purchase third-party liability insurance (commonly known as "three-insurance"). Therefore, when considering trading in a used car, remember to purchase car insurance before completing the transfer of ownership. If you want to transfer your old insurance policy to the new used car, remember to check with the insurance company to see if changing the insured vehicle is possible

Generally speaking, if the policy details remain the same, but you switch to a vehicle with higher horsepower and a higher price, the premium will naturally increase, and vice versa. Remember to be aware that if the old and new cars differ significantly in risk and coverage—for example, switching from a Nissan Sienta to an Alphard Hybrid—the insurance company is very likely to require you to sign a completely new policy. If the car model is similar, the insurance company may charge a handling fee; remember to notify the insurance company well in advance before switching vehicles

Many insurance companies now offer online car insurance quotes and application services. However, before trading in a used car, remember to ask the seller for a copy of the vehicle registration certificate so you can enter the vehicle information online, get a quote, and purchase car insurance. After purchasing the insurance, the insurance company will issue a temporary policy (Cover Note) to the prospective buyer

Just a reminder: when trading in a used car, you need to purchase car insurance for the vehicle in advance before you can complete the transfer of ownership! Once you've agreed on a price and purchased the insurance, the prospective owner can complete and signthe Vehicle Transfer Notice (TD25). Both parties must then personally go to the Licensing Office under the Transport Department to complete the formalities.

Getting a new car is certainly exciting, but there are several things to keep in mind. Before trading in your car for a used one, whether you're transferring or canceling your insurance policy, remember to contact your insurance company for a quote as soon as possible. Properly handling your insurance matters is essential for your safety!

Online car insurance quotes provide you with professional advice

AWM is familiar with auto insurance coverage and terms, as well as the auto insurance market. We will personally design an insurance plan for you based on your budget, driving experience, and coverage requirements; and strive to get the most favorable prices in the city to reduce your car ownership burden. Whether it's a pre-sale consultation or questions about existing policies, AWM insurance specialists are happy to provide you with professional advice free of charge. Please use our online quote service now, or contact us in person for more information