We all need to look for ways to make savings, especially when we have money worries. Although it might be tempting to let your car insurance lapse for a short period of time, this can cause all sorts of problems. There are several reasons why you need to keep your car insurance up to date and make sure you stay covered.
It’s the Law
In most states you need some level of insurance, in particular auto liability. This coverage takes care of any medical needs or vehicle repairs another person needs after an accident in which you were at fault. if you allow your liability insurance to lapse you are probably violating the law, even if the car is not being driven. Obviously, if you do drive the vehicle and are involved in an accident you will be cited, at which point you can expect to pay large fines, or face even worse penalties.
If you drive you car without insurance and you are at fault in an accident you may be sued for damages. This means you will pay for everything, including the other party’s legal counsel, and will end up losing a lot of money as a result.
Increased insurance rates
Continual car insurance often keeps costs down so if you let your insurance lapse you could end up finding it a lot more difficult to get affordable insurance. You may be considered a ‘risky driver’ meaning you have to pay a high risk insurer who charge a lot more for their policies.
Impacts on your driving record
Depending on your State, your insurance company may have to notify the State Bureau of Motor Vehicles if there is a change in your insurance, and this includes lapses. If this is the case it could be noted on your records and lead, in some cases, to seizure of the vehicle or suspension of your driving license.
Avoiding lapses in insurance cover
It is clear that maintaining active car insurance is a huge benefit and you should always aim to comply with legal requirements and cover your car in an affordable way. The best way to achieve this is to go to your local agent who can help secure a good affordable rate and can also assist if you do find your coverage has lapsed.
Be a responsible driver
The top two reasons why companies cancel a car insurance policy are non-payment or committing driving offenses. As the owner of the car it is your responsibility to pay the required insurance premium. You are also responsible for making sure you drive carefully. If you get too many tickets or have multiple accidents you may find your insurer will want to amend or cancel the policy. As a result you could find yourself with a lapse in cover.
Finding an affordable insurance option
An insurance provider will be able to discuss the possibility of discounts that can help keep the cost of your insurance down. At Nationwide there is an annual review which looks at your current cover. This On Your Side Review is a good chance to discuss adjustments, updates and so on, making sure your policy meets your needs. Where a lapse has already occurred the provider may agree to reinstate the policy, especially if it has only been out of action for a few days.