Life changes and so do your car insurance needs. Maybe you’re travelling Asia for two months and the car is going to sit at your parents’ house. Or, you just bought a 1955 Chevy Bel Air and it’s going to be in the garage for a months-long restoration.
There are many reasons you might be looking to save some money by temporarily cancelling or suspending your car insurance. But think twice before you do. Weigh your car insurance options so that you don’t find yourself with higher rates down the road. Here are a few.
Go to State Minimums, Find Discounts
The best option is to keep your insurance active and find ways to lower your premiums. You can reduce your insurance costs and avoid a gap in coverage by dropping to the state minimums. Don’t underestimate the cost of having a gap in car insurance coverage. You may find yourself faced with higher premiums when it is time to reinsure your vehicle.
Each state is different, so be sure to find out what your state requires. Your vehicle will still be covered, but you may be able to drop specific coverages to lower your premium payments.
Also, be sure to see if your policy has a discount for low-mileage. If your car isn’t being driven, you have a lower risk and should be able to save a bit of money.
Suspending your coverage also allows you to avoid a gap in coverage. However, suspending car insurance coverage is not commonly allowed by most insurance companies or states. Some do have special rules for military members, who may be deployed for months at a time, so it’s worth looking into.
Be very careful when deciding to cancel your auto insurance. A coverage gap could mean you will be in a high-risk category when it’s time to reinstate your coverage. This means you may be faced with higher premiums than you’re used to and maybe loss of any cost savings you had by temporarily cancelling your auto insurance.
In addition, you’ll face costs to register your car again and you face the risk of loss from other unexpected hazards like flood, fire or theft while your vehicle is idle. These don’t go away just because you are not driving your car.
Leased Vehicles or Vehicles with a Loan
You may not have any options for temporarily cancelling or suspending your car insurance if your vehicle is leased or on a loan. Lenders usually require certain coverage and dropping coverage violates your agreement. Make sure you check your agreement and meet the stated auto insurance requirements.
There are many states that require your vehicle to be insured, even if you aren’t driving it. Some states allow you to suspend or cancel your car insurance, as long as you file an affidavit of non-use with the state. Check with your state for specific requirements to avoid hassles down the road.
Research Your Options
The best way to save money and have the appropriate coverage is to compare auto insurance quotes. InsuranceWins can get you a quote in less than 2 minutes. See what you can save!