What Happens If You Don't Pay Your Car Insurance?

Updated 3 days ago
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It's illegal to drive without car insurance in all states except New Hampshire and Virginia. But in every state, if you don't have coverage, you're liable for all expenses related to an accident. You also face several penalties, including fines and even jail time for those who repeatedly drive uninsured.  

What are the penalties of driving after a lapse in insurance?

Driving uninsured is never a good idea, as you face many penalties, including:

  • A fine: The amount of this fine is between $500-$2000 for first-time offenders. Certain states also require you to pay an extra surcharge of $250 to the DMV and rule that you serve at least $1000 worth of community service.
  • License and registration suspension: You're stripped of your license and registration. The duration of this suspension is between 3-6 months, depending on your state's laws. You're not allowed to buy, drive, or own another vehicle for this period of time.
  • Impoundment: There are states, such as Louisiana, that take this offense so seriously that your car is impounded on a first offense. The duration of this impoundment depends on your state's laws and restrictions.
  • Imprisonment: Whether it's your first or second offense, some states have incredibly severe punishments, such as jail time. The length of your imprisonment depends on your state, but on average you spend between 10 days to 6 months in jail.

Do I still have to pay for my insurance if I'm not planning on driving my vehicle?

There are over 22 states that electronically check your auto insurance payments and ensure that you're maintaining your coverage, regardless of whether you're actively driving the vehicle.

If you've got a lapse in your insurance, these computer systems pick it up and send an alert to officials. You're then liable for a fine and possible vehicle impoundment until you reinstate your auto insurance.

How do you avoid a lapse in auto insurance?

There are ways for you to avoid a major lapse in your insurance. We've found some of the fastest solutions, such as:

  • Call your insurer: If your policy was canceled due to non-payment, contact your insurance to get your auto policy reinstated. You may be subject to an additional reinstatement fee on top of your monthly premium. Still, it saves you from facing other severe penalties.
  • Join a friend or family member's policy: If you're not able to reinstate or buy your own policy, then join another. Ask a close family member or friend to list you as a driver under their policy.

3 things to consider with a lapse in your insurance

  • If you don't pay your auto insurance installments, you're reported as having a gap in coverage. This leads to higher rates when you do decide to shop for a new policy.
  • Pay for your auto insurance with your credit card if you're facing a very tough month. This is only a good idea if you don't already have a considerable amount of debts to pay off.
  • Teenagers who've not yet found an insurance provider are typically forgiven by the state. However, they're given a set period to get coverage and are legally not allowed to drive their car until they do.

Save money on your auto insurance premiums

Here are some ways for you to get cheaper coverage if you're struggling to afford your auto insurance installments:

  • Switch providers: Compare our quotes and find a more affordable provider. Some insurance companies provide the state's minimum required insurance at a low rate.
  • Apply for discounts: Most insurance providers typically offer a range of discounts. Look at your options and see which ones you qualify for.
  • Take good driver course: Completing good driver courses makes you eligible for a discount. It also helps to clear your record, leading to decreased insurance premiums. Liberty Mutual offers safe drivers up to 30% off. Contact Liberty Mutual to see how much you can save, today!

Reinstate your auto insurance, now!

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