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How to Sign Over a Car Title to an Insurance Company

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If you are unsure about when you would have to sign over your car title to your insurance company or how to do it, then keep reading. We will cover the situations when you may need to do so, as well as how to go about doing it.

The main situation when you will need to sign the title over to the insurance company is if your car gets totaled. Depending on your coverage, the insurance company will buy your totaled car from you. That process involves you signing it over.

When Would You Sign Your Car Title Over to the Insurance Company?

You will likely only find yourself in a situation where you want to sign your title over to your insurance company if your car is totaled. 

For instance, if you crash your car into another vehicle or object and total it in the process, then you will need to sign over the title if you have collision coverage or comprehensive coverage. With this coverage, you will need to sign over the title before you can get the settlement payment from the insurance company.

Another applicable situation would be if another driver crashes into your car and the accident totals your car. In this case, the property damage liability insurance of the other driver will pay for the value of your car. To get that payment, you’ll sign the vehicle title over to their car insurance company.

Remember that not all types of insurance coverage will give you a large settlement if you total your car. For example, if you just have liability coverage and the total loss was your fault, then you are out of luck. Your insurance company will not pay for the vehicle in this situation, as you didn’t purchase coverage for that type of incident.

How to Sign Over Your Car Title to the Insurance Company

You will need to have the physical title for the process to work. This is crucial, as the title records ownership. If you financed your car and still owe the lender, then you will not have the title. The lender will have it, and they will also be part of the process of signing the title over. The good news is that in many cases, your insurance company and lender can work directly with each other. You may not even need to be directly involved in the process.

When you look at your title, you will notice spots to record the transaction cost, date and odometer reading at the time of the transfer. Fill in all of these fields. At this point, you will notice how similar signing over the title to your insurance company is to signing it over to any other new owner.

You and the insurance company will agree on the amount of money it will give you for your totaled car. Then, you will both sign the title. At this time, the insurance company sends you payment for the amount that you agreed upon. Your local DMV (Department of Motor Vehicles) will also likely require you to file paperwork indicating the change in title ownership. The DMV will typically ask for the vehicle identification number (VIN) and bill of sale. You may also need a certificate of title and contact information.

If you have a loan and still owe money on your car, then the insurance company will directly pay the lienholder for the vehicle. If the settlement amount is more than what was left on the loan, you will get any surplus money.

The opposite is also true. If the settlement amount is less than what you owe the lender, then you have to pay to make up the difference. The lender always has to receive the full amount they are owed.

If you have gap insurance, it will cover any remaining amount due to the lender. Gap insurance essentially covers the gap between what you get for the car in the settlement and what you owe the lender for the car.

After this process, the vehicle’s title will become a salvage title. A salvage title indicates that it is a salvage vehicle, or one that was written off as a total loss.

What if the Insurance Company Offer is Too Low?

Sometimes, you may think that the insurance company does not offer enough for your totaled vehicle. If this happens, you can keep negotiating with the company until you are satisfied before completing the title transfer.

However, you should keep in mind that it is not usually easy to get the insurance company to significantly increase its offer. The exception is if you can gather documentation or proof that justifies your suggested amount.

One example would be if you can show that there were documentation errors, such as for the condition or mileage of the vehicle. Another effective way to get the insurance company to increase its offer is to find relevant fair market value prices. If the actual cash values for a comparable vehicle are higher, you can use that to your advantage in negotiations.

Most car owners try to at least negotiate so the agreed-upon amount fully pays off the remainder of the auto loan. This goes back to the fact that you are responsible for any difference the lender is owed.

Our Recommendations for Auto Insurance

Finding the right auto insurance policy is crucial to ensuring you receive a payout if your car is totaled. To make it easier to find comprehensive or collision coverage, our experts have shared their recommendations. We suggest you get insurance from GEICO, USAA, or State Farm.

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GEICO: 9.1 out of 10.0

After extensive research, our experts awarded GEICO an overall rating of 9.1 out of 10.0 and the title of Best Overall. This rating breaks down to include a 9.8 for industry reputation, meaning GEICO takes second place in that category. GEICO also received a 9.4 for cost, an 8.5 for coverage, and a 9.0 for customer experience.

USAA: 9.6 out of 10.0

USAA is our choice for “Best Military Provider.” Remember that in order to qualify for USAA insurance, you or a family member must have served in the military or be currently serving. In addition to receiving a rating of 9.6 out of 10.0 overall, USAA earned 9.3 ratings each for industry reputation and customer experience, and a 10.0 for cost. Its coverage rating also earned an impressive 9.5.

State Farm: 9.1 out of 10.0

State Farm earns an overall rating of 9.1 out of 10.0 and is our choice for the best auto insurance provider for student discounts. It has an impressive 9.9 rating for industry reputation, making it a first-place winner in that category. State Farm also earns a 9.0 for coverage and cost, as well as an 8.8 for customer experience.


How do you transfer ownership of car insurance?

Transferring car ownership is as simple as signing over the title and taking care of any other paperwork your DMV requires. To transfer ownership of car insurance, you will need to contact your insurance company. Expect the company to ask you to provide some documents to show the change in auto ownership.

Can a car title be in one name and insured in another?

Yes, in most states you can have the car title in one name and have it insured under another name. However, few experts will recommend that you do this. That is because it can easily become complicated. Having different names on the insurance and auto ownership sets you up for issues with receiving insurance settlements or even billing.

Can you transfer the title of a financed car?

Yes, you can transfer the title of a financed car. However, in order to do this, you need to work with the lender in addition to the new owner. The lender will have to sign the title if you still owe money at the time of the transfer. In that situation, expect to pay the difference between what you still owe the lender and what the buyer actually pays an alternative option is to pay off the rest of the loan to your lender. Then, the lender will sign the title over to you and you can transfer it to the new owner. However, this is not typically the most practical route, as it can require your having a fair amount of cash on hand.

Can I sign a title over to someone?

Yes, you can easily sign a title over to someone. You just have to fill out the relevant field on the title and sign it. Remember to fill out any paperwork required by your state’s DMV as well.