My Auto Insurance Lapsed! What Do I Do?

Auto Insurance LapseIt might have been nothing more than oversight on your part. Maybe a major lifestyle change or a lack of available funds has forced you into the situation. Regardless of the ultimate reason behind it, a lapse in auto insurance coverage can cost you in more ways than one.

In 49 of the 50 states, the law demands that anyone who drives a vehicle in this country must at least carry liability insurance. Unless you happen to live in New Hampshire, a lapsed auto insurance policy could come back to bite you in the future.

Lapsed Auto Insurance and the Price You’ll Pay

When you’ve lost your auto coverage for any reason, your insurance company will waste no time in notifying the Department of Motor Vehicles. At this point, if you still own a registered car, you’ll have left yourself open to several penalties. These can vary from one state to another but will normally range from fines to suspension of your vehicle’s registration as well as of your driver’s license.

If you choose to continue driving at this point, things are about to get worse to a greater or lesser degree depending upon the state in which you live. When you get caught driving with lapsed insurance:

  • You could receive a ticket.
  • You might find yourself under arrest.
  • Law enforcement could impound your vehicle.
  • The DMV is certain to revoke your driver’s license and registration.

If you should happen to cause an accident while driving uninsured, you will have experienced the worst possible outcome. Without insurance to back you up, you will find yourself solely responsible for covering the costs of injuries and property damage for all parties concerned. This type of expense can escalate in a hurry and might even lead to your financial ruin.

If Your Auto Insurance Expires

It is quite unusual for an auto insurance policy to expire without your knowledge. All insurers will attempt to notify you long before the expiration date. If you should for any reason miss this notification, get in touch with your insurance agent as soon as you learn of the problem. When no more than a few days have passed since the due date, he or she may succeed in reinstating your coverage without penalizing you.

If a serious length of time has passed, however, you will have racked up a legitimate lapse of coverage. Simple reinstatement at your original rate might not be possible, and a new policy is likely to come at a higher cost. In any case, it is vital that you refrain from driving until you have obtained an up-to-date insurance card.

If Your Insurer Has Canceled Your Policy

When premium nonpayment or an excessive number of traffic violations have forced your insurance company to cancel your coverage, there is little chance of having it reinstated. In this sort of situation, you must obtain a new policy immediately, and don’t get behind the wheel until you have it.

Keep in mind that depending on the reason for the prior cancellation, your rates under a new insurer are likely to be higher. At times like these, it will pay you to shop around to find the most favorable rate.

Obtaining a New Auto Insurance Policy

When trying to obtain new insurance, the fact that your prior policy has lapsed will surely affect your experience. In the eyes of most insurers, the break in coverage will paint you as an irresponsible driver. The resulting blot on your image could lead them to charge higher auto insurance premiums, throw you into a high-risk pool or deny you coverage entirely.

Once your insurance has lapsed, you can almost always expect to be paying oversized rates on a new policy for several years to come. This is one of those times when shopping the market can make a big difference. Unfortunately, few people have the time, the inclination or the expertise to do this in a thorough fashion.

That’s where All Kinds of Insurance comes in. We specialize in doing the research necessary to get you the most effective coverage at the lowest possible rates, even if you’ve suffered a lapse. Don’t pay more for auto insurance than you must. Call our office at 702-534-4697, or fill out our contact form for help today.