hello
@Allain
a warm welcome to DTP
what a tricky issue driving is
only you as his family know whether of not your dad is safe to be out on the road ... a diagnosis itself doesn't necessarily mean that someone has to immediately stop driving, nor that your dad couldn't be insured ... it's much more down to safety for other drivers and himself
if you are unsure, maybe look into a driving assessment
if you are sure, and your dad is no longer able to drive safely, you are right to have taken action and if it is an acceptable excuse to him say to him that sadly he can't be insured, which puts the 'blame' away from you and you can sympathise with him while suggesting he will save all the costs and can take taxis and buses instead
however, given the nature of dementia, It may be that your dad will not retain or accept any explanation but will hold on to his belif that he should still be able to drive, so maybe best to keep the car out of sight and not get into discussion about it