What Happens if Car Insurance Lapses?
Life is busy and we forget to do things that we need to do nearly every day. Yes, even if you have your handy “things to do today” list!
Want to know what lots of folks forget about during the busy course of their days and weeks? Paying their car insurance policy!
Oops!!
Thanks to Your Grace Period, There’s No Need to Immediately Panic!
So you had a busy work week, chauffeured the kids to all their play dates and sporting events, cooked terrific dinners for your family every night, but wait … the week was so crazy you forgot to pay your car insurance on time!
Thanks to your auto insurance company’s grace period, a simple slip of your “to do” list will not have a major impact on your car insurance policy.
The majority of car insurance companies nationwide offer their customers grace periods in case of these payment slip-ups.
Your grace period depends solely on the auto insurance company you have. Some companies offer 3 day grace periods, while others may offer you nearly 30 days to get up to speed (so to speak) with your auto insurance payment (or payments if you happened to have missed more than one).
Your specific grace period will also depend upon which state you live in. Furthermore, your auto insurance company may or may not attach an extra fee or penalty when you use your grace period.
So Again, What Happens If Car Insurance Lapses For a Short Period Of Time?
…Again, thanks to grace periods, usually nothing much to speak of (depending upon the state you live in, of course).
Always be on the safe side, though!
Even if you have a car insurance lapse of one or two days, speak to an agent at your auto insurance company to make absolutely sure your grace period covers the time without insurance. Furthermore, if you are aware of a missed payment and know for a fact that you have a lapse – even if it’s just for the day – don’t drive your car until you talk with someone at your insurance agency.
Whether On Time or Late With a Payment, Be Sure to Know Your Policy Details!
Sure, your grace period helps a ton, and you can generally be rest assured that your auto insurance will not be cancelled right away because of a missed payment.
However, we do highly recommend you read and review the specific details of your auto policy carefully and with complete understanding of the grace period details, as well as the entire policy itself.
(That is, when the dinner dishes are cleaned up and after the kids have gone to bed, of course.)
Also, if you absolutely know you will be late in making a payment to your auto insurance agency, we strongly suggest you call your company as soon as you are able to in order to discuss the situation and come to a resolution without having a true (and potentially serious) car insurance lapse.
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Find Out About Discounts and Ways to Never Miss a Payment Again
News flash!
Many auto insurance companies allow you to sign up online for easy automatic payment options, so you can rest assured you won’t have to stress or wonder about “what happens when car insurance lapses.” What’s more, many insurance companies provide you with a discount when you sign up for automatic payments. It’s a win – win situation!
According to State Farm Insurance, you may be eligible for one or more of many auto insurance discounts.
Although discounts do vary from state to state, you could save money through different cost-saving insurance rates for:
- Being a safe, accident-free driver with a clean license
- For being a good student
- For a family that owns several household vehicles
- Taking, and passing, a defensive driving course
So Your Car Insurance Has Lapsed. Now What?
Forgetfulness because you were too busy or something else in life came up is one thing, but there are indeed times when you may experience a true car insurance lapse due to lack of funds or other, more extensive reasons.
Not having car insurance on a vehicle you use can carry serious consequences. This is why you should really read and know all the particulars of your policy before your car insurance may contend with any type of extended lapse jeopardy. You probably don’t want to deal with all of the technicalities and negative news within the answer to the question of, “what happens when car insurance lapses.”
That said, do everything in your power to speak to someone at your auto insurance agency as quickly as possible, and work on getting your insurance current – ASAP!
What Can Happen If I Don’t Have Current Car Insurance?
As always, rules and regulations surrounding uninsured cars differ from one state to the next. But no matter where you live, having lapsed auto insurance will always cause a headache.
Or worse.
Lapsed auto insurance can rain down a number of unpleasant situations and other things:
If your state's Department of Motor Vehicles is notified by your insurance company that your vehicle has lapsed insurance, you can be fined quite a sum of money! Some states will even suspend your license
Even with a grace period in effect within your specific insurance agency, a lapse in coverage for any amount of time can lead to rate increases that will surely hurt your wallet.
If your car is still being financed, some lenders will repossess your car due to a break in your loan or lease agreement. Since most lenders require, as part of your loan and financing agreement, comprehensive and collision coverage on the vehicle being financed, they don’t want to take the chance of you or someone else driving the car. They would rather take it back and secure the vehicle than wait for someone to get behind the wheel of the still unpaid-for car.
If you get behind the wheel of an uninsured car and get caught, it may be a long time before another auto insurance agency will take you on as a client. And those that do are sure to charge you enormous policy premiums.
There are some states that will literally place you in jail if you drive an uninsured car and have an accident. That’s because:
- It is against the law to drive a vehicle that has lapsed insurance coverage.
- Having an accident in an uninsured car, especially if the accident is your fault, can change your life significantly. You will be solely responsible for paying for the damages done to your car as well as the car you were in the accident with.
- If an insured driver’s car is hit by your lapsed insurance vehicle, the insured driver has every right to sue you.
Ready to Fix That Insurance Lapse and Get Back Behind the Wheel?
It may not be as simple as one single phone call, but where there’s a will there’s a way.
First, call up your previous auto insurance company and see if they can reinstate or renew your policy
If that fails, you can go ahead and purchase a brand new auto insurance policy. Be aware that your rates will most likely be quite a bit higher than before!
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Take a peek at the helpful and informative auto (and other) insurance information on Insurry.com. Don’t forget to look for The 7 Best Cheap Car Insurance Companies Available video. We think you’ll find the content extremely helpful!
