Driveaway insurance helps when you buy a new or used car and do not yet have full auto insurance. It gives you short-term coverage so you can legally and safely drive the car home or to a repair shop.
This coverage fills the gap that can happen right after purchase, when regular insurance may not start immediately.
What Is Driveaway Insurance ?
Driveaway insurance is temporary car insurance. It usually lasts from 1 day up to 30 days. It is made for the short time right after you buy a vehicle and “drive away” with it.
Many dealerships offer this insurance at the time of sale. It allows you to drive the car instead of towing it. This is not a full-year policy. It only works as a short bridge until your regular insurance begins or you buy long-term coverage.
In the United States, every state requires drivers to have insurance. Driveaway insurance helps you stay legal right after buying a car.
Some personal auto policies automatically cover a new car for 4 to 14 days, but this often applies only to new cars and short distances. Used cars or long trips are often not covered, so you should always check.
Dealer driveaway insurance is usually for one-way trips. Independent providers may allow longer coverage and more flexibility.
Main Coverage Included
Driveaway insurance is similar to regular auto insurance, but only for a short time.
- Liability coverage
Pays for injuries or damage you cause to other people.
This includes:- Medical bills for others
- Repairs to their car or property
It usually meets state minimum limits, such as $25,000/$50,000.
- Collision coverage
Pays to repair your car if you crash, no matter who caused the accident.
This is helpful when driving an unfamiliar car home.
- Comprehensive coverage
Covers non-crash damage, such as:- Theft
- Fire
- Vandalism
- Hail or falling objects
This applies even if the car is parked overnight.
Some policies also offer roadside assistance or rental car coverage, but these are usually optional.
Only drivers listed on the policy are covered. If more than one person will drive, all must be named.
Deductibles are usually between $250 and $1,000, depending on what you choose.
Real-Life Examples of Coverage
- You hit a deer 50 miles from the dealership.
Collision coverage pays for repairs, minus your deductible. - You rear-end another car while driving home.
Liability coverage pays for their injuries and car damage. - Your car is broken into overnight while the policy is active.
Comprehensive coverage pays for the stolen items or damage.
Driveaway insurance is helpful for long-distance or cross-state purchases.
However, it does not cover mechanical problems that already existed. Those issues fall under warranties, not insurance.
What Driveaway Insurance Usually Does Not Cover
Because it is short-term insurance, it has limits.
Not covered:
- Business or commercial use (delivery driving, rideshare, etc.)
- Racing, track driving, or off-road use
- Normal wear and tear
- Intentional damage
Other common limits:
- Very expensive cars (often over $100,000)
- Heavily modified vehicles
- Very young or elderly drivers (age limits may apply)
- Some policies only allow one trip, such as from dealer to home
- Dealer plans may limit distance (for example, 100 miles)
Always read the policy details carefully.
Coverage Table
| Coverage Type | What It Covers | What Is Not Covered |
| Liability | Injuries and property damage to others | Your own car, intentional damage |
| Collision | Damage to your car from accidents | Mechanical problems, wear and tear |
| Comprehensive | Theft, fire, weather, vandalism | Floods (sometimes), animals, modifications |
| Medical | Injuries to passengers | Driver injuries, existing conditions |
| Roadside | Towing, flat tire (if added) | Too many calls, far locations |
Cost and Duration Options
Driveaway insurance is usually affordable.
- 5–7 days: about $20 to $100
- Temporary monthly insurance costs more: $50 to $200
Dealers often charge more because it is convenient. Online providers are usually cheaper, sometimes around $15 per day.
Available time periods:
- As short as 1 hour for quick pickups
- Up to 30 days if there are delays with registration or shipping
Factors that increase the price:
- Young drivers
- Sports or luxury cars
- Driving in large cities
Some dealerships include 3–5 free days of coverage with financing.
Cost Table
| Duration | Approximate Cost (Sedan) | Best For |
| 1–24 hours | $15–$30 | Local pickup |
| 3–7 days | $40–$80 | Driving home and registration |
| 14–30 days | $100–$250 | Long trips or insurance delays |
Temporary policies rarely offer no-claim discounts.
How to Buy and Use Driveaway Insurance
You can buy driveaway insurance:
- At the dealership during paperwork
- Online through temporary insurance providers
You usually need:
- Driver’s license
- Vehicle details (VIN)
Coverage often starts immediately. You receive digital proof, which you can show to police if needed.
Contact your regular insurance company as soon as possible. Some companies automatically cover new cars for a short time, but rules vary. Driving uninsured can result in fines of $1,000 or more.
Driveaway Insurance for Dealers and Businesses
Dealers often use special driveaway coverage as part of their garage insurance. This allows them to transport vehicles over long distances, including customer deliveries and vehicle transfers between locations. It is important for dealers that sell cars nationwide.
Common Mistakes to Avoid
- Do not assume your old car’s insurance covers the new one
- Check state laws carefully (some states require proof before plates)
- Do not rely on driveaway insurance for long-term use
- If driving many miles, consider a stronger temporary or non-owner policy
In 2026, car theft rates are rising, so having comprehensive coverage, even for a few days, is very important.
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FAQ: Driveaway Insurance Basics
Is driveaway insurance required by law?
There is no federal law, but all states require insurance. Driveaway insurance helps meet that requirement.
Does my personal auto policy include driveaway coverage?
Sometimes. Many policies cover new cars for 4–14 days. Used cars often are not covered.
Does it cover theft while driving home?
Yes, if you have comprehensive coverage.
Is it cheaper from a dealer or online?
Online is usually 20–40% cheaper. Dealer coverage is faster and more convenient.
Can more than one person drive the car?
Yes, but all drivers must be listed on the policy.
What if I drive farther than allowed?
Some policies limit miles. Others do not. Always confirm before buying.
Does it include a rental car if mine breaks down?
Usually no. This must be added separately. Towing is more common.
