If a vehicle is to be titled out of state and the purchaser does not have liability insurance, what must the dealer do?

When a vehicle is to be titled out of state and the purchaser does not have liability insurance, the dealer is required to collect a fee for uninsured motorist coverage. This is a critical step because many states mandate that any vehicle being driven or registered must have some form of liability insurance to protect against potential damages or accidents.

By collecting this fee, the dealer ensures that there is coverage in place, which can help to provide financial security and accountability in the event of an incident involving the vehicle before the new owner secures an appropriate insurance policy. This requirement ultimately protects not just the purchaser but also other road users, aligning with roadway safety regulations.

While the other options might seem relevant under different circumstances, they do not directly address the requirement for uninsured motorist coverage in this specific scenario. For instance, issuing a permanent title without insurance would not comply with legal obligations, providing a refund does not fit with the necessary actions, and offering a discounted rate may not correlate with fulfilling insurance requirements. Thus, collecting the fee for uninsured motorist coverage is the correct and responsible procedure.