When cash is tight, everyone looks for ways to cut back. One temptation is to allow your car insurance expire, even for a shortest period of time. This really is not a great idea, since a car insurance lapse can cause you some unexpected issues. Here are many reasons it’s imperative to stay protected and avoid a lapse in coverage:
Most states demand some level of auto liability insurance. This is the coverage that pays for the other person’s medical requirements or property damage from an accident, if you are at fault. So if you own a vehicle and you’ve allowed the liability insurance on it to lapse, you might be violating the law – even if the vehicle is parked and not driven. If you drive the car and cause an accident without being covered, you’ll be cited and subjected to stiff fines or worse.
Driving without vehicle insurance is risky. If you’re responsible for an accident and don’t have insurance, you may be sued to pay for the damages – and end up paying for everything, including the lawyer, out of pocket.
Insurance rate increases
After a vehicle insurance lapse, you may find it harder to get insurance at an affordable rate. You may even have to resort to a company that specializes in risky drivers – which is almost never a good deal, because high-risk insurers charge more for their policies.
Driving record impact
In most states, auto insurance companies are needed to notify the Bureau of Motor Vehicles when you drop insurance or change companies. So once you have a lapse in car insurance, it may be noted on your driving record. In some situations, your car could even be seized or your license suspended.
How to avoid a lapse in coverage
By now, the benefits of keeping your vehicle insurance active should be clear. Your ultimate goal should be to keep your vehicle insurance coverage affordable and compliant with state laws. Your best resource for keeping you insured and protected is your local agents. They are also the person to turn to if you do end up with a lapse in coverage.
Vehicle insurance policies are cancelled for two main reasons: non-payment and driving offenses. As a car owner, you are responsible for consistently paying your car insurance premium. You are also responsible for driving safely; too many tickets or accidents on your record can cause an insurer to cancel your policy, leading to a lapse in coverage.
Discuss affordable coverage options
Speak with your insurance provider about any discounts you may be qualified for that can assist keep your premiums affordable