It can happen to any of us — you get busy, something unexpected comes up and — oops! You forget to pay your auto insurance. What happens if car insurance lapses? The moment you find out that you missed a payment, it’s easy to panic and wonder if you can ever get car insurance again. But the good news is that in most cases, you’ll be fine. As long as you act quickly and work with helpful insurance agents, there is a path to get you back to full vehicle insurance coverage.
In most cases, drivers inadvertently allow their policy to lapse. Maybe they missed an email or notification letter, or life just got too busy. Most insurance companies understand that things happen and are willing to work with you when you call them and are honest about the situation.
However, no matter the reason, as soon as you know that you’re driving without coverage, it’s important to stop driving and get your vehicle covered as quickly as possible. In most states, driving without insurance is illegal, and being caught without an auto insurance policy can incur heavy fines. If you get into an accident without insurance, you may even need to file an SR-22 certificate of financial responsibility to continue to drive. So, now that you know you have a car insurance lapse, it’s time to act. Otherwise, these are the things that can happen if you leave your insurance in a lapsed state.
If you’re wondering what happens if car insurance lapses regarding future coverage, one of three things will happen. Overall, the amount of time you go without being covered by a valid car insurance policy will determine your available options. The less time you go without coverage, the better your outcome will be.
More often than not, the majority of auto insurance companies understand that an overlooked payment is usually unintentional, and they’ll most likely extend coverage to you after you pay. When it’s easy to get back on board, you have contacted the insurance company within the car insurance lapse grace period. This quick action proves that you are a responsible driver and are set on making things right, which looks good on your insurance profile.
Also, customers who have been insured by the same insurance company for some time and whose driving record is clean will have a far greater chance of being reinstated. So, to keep a good relationship with your auto insurance provider, let your agent know about your intentions to pay as soon as possible.
After you find out that your car insurance lapsed, a few things automatically happen behind the scenes. Generally, the necessary parties get notified about the lapse of coverage, presenting you with some consequences if you don’t act right away. When you find out that your car insurance has lapsed, two immediate facts are true:
While forgetting to pay a common bill can cost you a late fee, letting your auto insurance lapse because of a missed payment can cost you a great deal more than that. Stay on top of your premium’s due date, and make sure you’re getting the best rate on your auto insurance. You may have a generous insurance company that can reinstate your policy even after a significant auto insurance lapse. Or, you may be denied coverage even after just a week of nonpayment. Since the results can vary, be sure to prevent any future lapses in coverage.
It’s easier said than done to stay on top of multiple payments that occur on different dates. To prevent any further lapse in insurance coverage, set yourself up for success. This means you should make it as easy as possible to pay your bills without feeling confused, overwhelmed, or burdened. Thankfully, there are many modern solutions to make bill payment easier — and faster— than ever.
Our final piece of advice is to eliminate any option that involves mailing a check, which can get delayed or lost in the mail. Although this option is available to many insurance providers and utility companies, this form of payment can be unreliable. You may accidentally mail a check a day late, or there could be a delay in mail delivery.
Also, inclement weather can significantly delay traditional mail routes and make you unintentionally late in your payments. If a check is lost, you have to also issue a stop payment order for security reasons, which takes up your time. To find out more about auto payments and other ways to stay on top of your policy, contact an auto insurance agent today.
The procedures each auto insurer uses to reinstate a policyholder following a lapse may differ. However, auto insurance companies need to make sure you won’t be a further risk to them. This may look different to each company depending on their policies. For instance, some auto insurance companies may require you to pay your next quote in bulk to ensure they receive the funds.
You may be offered several payment options as a condition for reinstatement. These may include using a credit card, ATM card, or banking account information on file for automatic withdrawal each month so that your past payment oversights don’t occur again. By agreeing to any of these forms of payment, you’re more likely to get your coverage back quickly and eliminate the risk of future lapses — not to mention, give you peace of mind.
If your auto insurance policy provider decides not to move forward with you, this is not the end of the road. You can easily find an independent insurance agent who can offer you a new set of quotes from other auto insurance providers. From here, you can make an educated choice about which plan provides the best deal for the price.
A lapse in non-standard insurance is another story due to the already existing SR-22 addendum of financial responsibility. Each state has its own restricted license in SR-22 insurance laws. For instance, if you live in Florida, you will need to contact the Florida Highway Safety and Motor Vehicles to know exactly what will happen to you.
Generally, any lapse in SR-22 insurance makes it necessary for the driver to reapply for a restricted license and refile SR-22 insurance with their insurance agent. This is because the insurance agent is obligated by law to notify the state’s DMV about the lapse in coverage. To make sure you never lapse in your SR-22 insurance, set up autopay when you create an SR-22 insurance plan or pay your premiums in bulk.
Worry no longer about what happens if car insurance lapses, especially when you can get affordable auto insurance from Freeway Insurance. We offer quality auto insurance to fit your needs and budget — even if you have a bad driving record. You can request a free auto insurance quote online, call us at 800-777-5620 or visit one of our offices near you.