Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health insuran...

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Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

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Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager Chris Harrigan

UPDATED: Aug 6, 2021

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Key takeaways...

  • A title is a legal proof of who is the rightful owner of the car
  • As a motorist, you should check with your state Department of Motor Vehicle for the particular requirements concerning registration, licensing, title transfers, and insurance requirements
  • As the owner of the vehicle, you should possess the title and have it kept in a secure place
  • Before you can drive a car on US roads, the law requires you to have proper insurance, license plates with current validation stickers, and a permit that shows you legally own the vehicle
  • In some states, the buyer or seller do not have to prove that they are licensed or that the car is insured in order to be issued or transferred a title

You are legally required to have car insurance before you could drive a car and you must present an up-to-date Certificate of Insurance to settle your motor tax.

Driving without car insurance is a serious crime and drivers can incur the following:

  • Penalty points
  • Fines
  • Disqualification to drive

Typically, the owner of the car is the one who is supposed to insure it. However, most states allow insurance premiums to be paid by someone else other than the registered owner.

Unfortunately, this does not work well with all the insurers. Some insurance companies will not insure a vehicle if the owner and the policyholders are different.

If someone other than the car owner insures the vehicle, the insurance company may refuse to pay a claim for the same reason.

Compare top car insurance companies side-by-side. Enter your zip code in our free comparison tool above.

Car Title


This is a legal form, proving that a person or business is the legal owner of the car. It establishes who legally owns the car. If you buy your vehicle directly from the dealership, you should be given the title right away.

If you took out a loan to buy a car, the loan company keeps the title until you have paid your loan in full. The title will then be transferred to you.

If you buy a car from an individual, he/she should sign the title to you. You can then follow the appropriate steps to get a new title from DMV.

If you are renting out your car, the rental company will have the title. Simply put, a title proves ownership. However, it does not license the owner or insure the car.

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Car Registration

Vehicle registration is different because it is something required by the government to show that you are registered with them and that you have paid any fees or taxes due. The amount charged for car registration varies from state to state.

Some states also demand that you have a yearly car inspection or emissions test before your car is registered. When registering your car, you will likely be asked to produce the title, driver’s license, and proof of insurance.

Car registration is closely related to the titling process. In some states, you will be given a license plate as well as a registration sticker or document to put on the windshield.

In Florida for instance, after car registration, you will receive the following:

  • A registration certificate
  • A validation decal
  • A metal license plate

Driver’s License


This is issued by your state Department of Motor Vehicle regardless of whether you own a vehicle, have insurance, or have a registered car.

However, you will be required to show proper identification, like proof of residency and a birth certificate.

You will also be needed to pass both written and practical tests and pay a fee. You may also be required to pass an eye test. These requirements vary between states.

Car insurance

In almost all states, motorists are required to have car insurance to be allowed to drive. The most basic and most commonly required form of car insurance is the liability coverage which covers damages to vehicles and other property that you may cause.

Some states also demand that you get a bodily injury policy which pays for injuries if you happen to cause an accident that leaves someone hurt or killed. Some states require med pay insurance which pays for medical expenses due to a car accident.

If you are leasing your vehicle or have a loan on it, then you will be required to have the collision and comprehensive coverage.

To be able to get car insurance, you need to have some proof of ownership, although the guidelines depend on your insurance provider. Some insurers allow parents to add their kid’s car on their insurance policy without necessarily being on the title.

In most states, your child is allowed to register the vehicle under his/her name even if the parent is listed as co-owner. State laws also differ when it comes to the proof of insurance needed to register a car.

Some states only require the insurance to be in the car and not necessarily in the owner’s name.

In others, the car owner’s name has to appear on the proof of coverage. For instance in Texas, the car’s proof of insurance has to show the owner’s name in order for the car to be registered.

Different states have different laws when it comes to car registration, licensing and insurance. Check with the DMV in your state to confirm if they allow a car to be insured under a different name from the one it is registered with.

Also, check around and get an insurance company that allows this kind of arrangement and get to know their terms of service.

Before making any final decisions on your insurance company, it is important to learn as much as you can about your local insurance providers, and the coverages they offer. Call your local insurance agent to clear up any questions that you might have. Questions to consider asking include, “What is the best coverage plan for me/my family/my situation?” “What are the minimum coverage requirements in my state and what form of coverage do you recommend?” “Do you guys offer any bundle discounts if I take out both my auto insurance and home insurance with you?” and “What is the average rate of insurance quotes you guys offer?”

Before making any big insurance decisions, use our free tool to compare insurance quotes near you. It’s simple, just plug in your zip code and we’ll do the rest!

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