If you don’t pay your auto insurance premiums on time or cancel a policy without replacing it with another, your coverage will lapse. You may be unprotected if you get into an accident, you may have to pay a fine, and your premiums may go up in the future, even if the lapse only lasts one day.
What Can Happen If You Let Your Coverage Lapse
If you cause an accident while uninsured, you will be financially responsible for repairs to your vehicle and the other drivers, medical bills, and other property damage. If you can’t pay, the driver may sue you, and your assets, including your house and savings and retirement accounts, maybe in jeopardy.
If you cancel your coverage, the insurance company will be required to notify the Connecticut Department of Motor Vehicles. If you don’t purchase a new policy, you will receive a warning letter giving you an opportunity to enter into a consent agreement, get new insurance, and pay a fine. If you don’t, your vehicle’s registration and your registration privileges will be suspended. You may have to attend a hearing and may lose the right to register any vehicle.
If you let your coverage lapse, you may have trouble getting insurance in the future. Some auto insurers will only provide policies to drivers with a minimum period of continuous coverage. If you can get insurance, you may have to pay higher rates.
How to Avoid a Lapse in Car Insurance Coverage
If you plan to be away for a period of time and won’t use your vehicle, or if you have a car that you only use during part of the year, you may suspend liability coverage to keep your premiums down. You will have to maintain comprehensive coverage and will not be allowed to operate the vehicle while it doesn’t have liability coverage. That won’t be considered a lapse in coverage and won’t affect your rates.
You may not be able to suspend coverage if you have an outstanding car loan or lease.
However, if you do suspend your coverage, you may have to cancel the vehicle’s registration and pay a fee to reinstate it later. You will not be covered if the car is damaged by weather or vandalism or gets stolen. You may have to pay higher rates later to reinstate coverage.
Find the Right Auto Insurance
If you decide to switch policies, make sure that there is no gap between the end date of the old policy and the start date of the new one. Consider setting up automatic payments so you never miss a due date.
Petruzelo Insurance can help you choose the right coverage options and get you quotes from several leading insurers. Contact us today to learn more.