Selling your car? You’ll want to be aware of how test driving a used car in a private sale could affect your car insurance rates.
It’s a common scenario, and you want to get as much money for the vehicle as possible—often at rates that dealerships simply won’t offer through trade-in deals (which also involve spending more money to get a new vehicle). It’s especially convenient to sell items on your own with the rise of so many online marketplaces like Kijiji and Facebook.
It’s true that there may be a significant financial upside to selling your vehicle privately, but there are a few things that you need to consider first.
Let’s talk about car insurance for a moment to provide a few tips on what to consider about your insurance policy, and how to put your safety and protection first when a prospective buyer wants to test drive your vehicle.
First, you still need liability car insurance to operate a vehicle. Even if the buyer doesn’t have a policy yet, the seller will need to maintain his or her policy until the car is sold. That’s because whoever owns and/or operates the vehicle is still responsible for it, even during a test drive. The test driver would be considered an incidental driver (as opposed to a secondary driver) under the seller’s policy.
When you’re asked about test driving your used car for a private sale, you’re also lending that person your insurance. Make sure you keep these things in mind:
The most important piece of advice is to trust your instincts. If any aspect of the potential buyer makes you uncomfortable, don’t turn over the keys. As a private seller, you are not compelled to let somebody drive your car—ever.
Ask a friend to join you if any aspect of the process makes you uncomfortable. Don’t feel bad or awkward about it. It’s always better to err on the side of caution.
If you do sell it (congrats!) then you’ll need to tell your insurance company about the car’s changing ownership.