Letting Auto Insurance Lapse Could Be a Costly Mistake

During these tough economic times, you may think you don’t need car insurance and let your policy lapse. But this could be an expensive blunder. Not only will you pay a higher premium when you renew your policy later on, but you also put yourself at substantial financial risk, if you are involved in an accident in the meantime. Make sure you don’t have a gap in your auto insurance coverage, when you apply for an auto insurance quote.

Drivers who allow their policies to lapse for any reason could wind up paying an initial 25 to 50 percent surcharge when they buy a new policy as well as higher premiums. Insurance companies charge these motorists more because they consider them to be irresponsible drivers and, therefore, higher risks to insure. Reports show unlicensed and uninsured drivers are disproportionately involved in fatal accidents. On the other hand, drivers who have good driving records are able to get safe-driver discounts on their insurance premiums. Make sure you research all the discounts you are eligible for, before you get an auto insurance quote.

Driving without insurance is also against the law. All states, except for New Hampshire, require drivers to have some form of basic car insurance. So, if a police officer stops you while you’re on the road and gives you a ticket for failure to have insurance, you could wind up paying a costly fine or even losing your license for a period of time.

You could also incur a lapse in your auto insurance coverage, even if you intend to insure your vehicle. Any amount of time your vehicle is registered, but not insured could constitute a lapse in coverage. If you don’t have any gaps in your coverage, you may be able to get a loyalty discount from your current auto insurance company. Here are some ways to avoid having a lapse in your insurance coverage:

• Pay your insurance bills on time. Your insurance company can cancel your policy for non-payment.
• Don’t cancel your existing policy, until you know when your new one becomes effective. When you shop for a new policy, be aware that you don’t want a gap between when your old policy ends and your new one kicks in.
• Have insurance when you register your car. You don’t want a gap between the time you register your vehicle and the effective date of your new insurance coverage.
• Get a new policy, if you know your insurance company is planning to cancel your policy for any reason. For instance, your insurer may decide to drop you, if you have been involved in accidents or have been picked up for driving under the influence.

If you do let you insurance lapse, you may have a hard time buying a new policy. You may have to buy auto insurance company through your state’s assigned risk pool. Insurance companies that do business in your state are required to participate in this pool for higher risk drivers.

When you are ready to buy a new car policy, you can call agents in your local area, contact insurance companies directly or use InsuranceQuotes.com to instantly get a competitive auto insurance quote from the nation’s leading insurance providers. Simply fill out a simple online form on InsuranceQuotes.com to find the right insurance coverage at the best possible price. Take the time to protect you and your family today.