Here’s why it’s smart to stay insured
In tough economic times, everyone looks for ways to cut back. You could be tempted to let your car insurance expire, even for a short period of time. Unfortunately, a car insurance lapse can cause major problems for you. Here are several reasons why it’s important to stay covered.
Most states require some level of car liability insurance that pays for another’s medical costs related to an accident or damages to another person’s property or vehicle if you’re at fault in an accident. If you own a car and you’ve allowed a lapse in auto insurance, you might be violating the law, even if the car is parked and not driven. If you do drive the vehicle and cause an accident, you’ll be cited and subjected to stiff fines or worse.
Driving without car insurance is risky. If you’re responsible for an accident and don’t have insurance, you may be sued to pay for the damages – and end up paying for everything, including the lawyer, out of pocket.
Insurance rate increases
After an auto insurance lapse, your ability to get insurance at an affordable rate could be compromised. And, chances are, it will be at an increased rate. You may need to search for an insurance company that specializes in insuring risky drivers. Typically, high-risk insurers charge more for their policies, so complete, affordable coverage might be difficult to obtain.
Driving record impact
In some states, auto insurance companies are required to notify the Bureau of Motor Vehicles when you drop insurance or change companies. Once you have a lapse in auto insurance, it may be noted on your driving record. Your car could be seized and your license suspended.