what happens to car insurance when you sell your car

When you sell your car in Australia, your car insurance doesn’t magically transfer to the new owner. Instead, your policy typically gets cancelled or adjusted because the insured vehicle is no longer yours. You should notify your insurer immediately to avoid paying for coverage you no longer need. Some insurers might offer a refund for the unused portion of your premium, but don’t expect a fortune back—administration fees can nibble that away.

If you’re buying a new car, it’s a fresh start with a new policy, often at a different rate depending on the vehicle and your history. Meanwhile, the buyer should arrange their own insurance before hitting the road, or face the wrath of the law and their wallet.