How to Reinstate Canceled Auto Insurance

Whether your auto insurance coverage has lapsed or not, your policy could be canceled if you’re late on payments, and you may or may not be able to reinstate it. Insurance companies have differing reinstatement policies for auto insurance. While some are strict and don’t allow any reinstatements after cancellations, other companies are more lax.

We’ll show you the policies of all the major companies when it comes to getting your car insurance reinstated, so you don’t have to go to the trouble of switching providers.

How to Reinstate Auto Insurance

First, determine whether getting your car insurance reinstated is a real possibility. Depending on how much money you owe, whether you have a history of nonpayment, and how late your payment is, you may not be able to reinstate your policy.

Can You Reinstate a Car Insurance Policy?

Reinstating canceled auto insurance will require you to contact your insurance company and pay the premium that you missed. An agent will determine whether they can restore your previous policy, which will depend on your insurance history, the policies, and your insurer.

To see how some of the biggest insurers handle canceled policies, click on your company below to find out if and how you can get reinstated.

Reinstatement Penalties

As you can see in the chart above, you’ll sometimes have to pay a fee to reinstate your policy. Clearcover has the highest fee we’ve seen at $35 (and you’ll probably have to pay your past-due balances as well).

Types of Reinstatements

There are two basic types of reinstatements: lapsed and non-lapsed coverage.

• Lapsed coverage: If your coverage has lapsed, it’ll be harder but not impossible to reinstate your policy. Talk to your agent to find out if they can reinstate your policy, but they could refuse service, requiring you to switch car insurance.
• Non-lapsed coverage: The process will be easier if your coverage hasn’t lapsed. It’s most likely you’ll just need to make the late payment, so long as you’re within the grace period for canceling as dictated by your state (see below for details). Learn more in our auto insurance FAQs.

What Is Car Insurance Reinstatement?

Car insurance reinstatement is when your insurance provider restores your canceled policy with the same policy number and coverage.

Benefits of Reinstatement

There are benefits of reinstating your policy rather than starting from scratch by finding a new provider and policy.

• Get coverage. First of all, you can restore the same coverages you had before. For full coverage, that’s property damage coverage, bodily injury coverage, collision and comprehensive coverage, and uninsured motorist coverage.
• Avoid a lapse. Avoiding a lapse in coverage can prevent you from driving without insurance, which has legal and financial penalties in every state but New Hampshire and Virginia. Continuous coverage also leads to lower rates later on.
• Stay with your provider. It’s convenient to stay with your current provider and not have to switch providers and compare rates.
• Keep the same rates (usually). Most of the time, you’ll be able to keep your previous auto insurance premiums. However, this isn’t always the case. For example, with The General, your rates will go up based on the length of your lapse.
  • One month or less: 9 percent increase
  • One month to 60 days: Up to a 48 percent increase
  • Over 60 days: You probably won’t be able to reinstate your insurance.¹

How Many Times Can You Reinstate a Car Insurance Policy?

The number of times you can reinstate your car insurance policy depends on the provider. Most companies are OK with one-time issues, and some companies will accept multiple reinstatements. It’s always worth calling your agent directly and asking.

What if I Can’t Reinstate My Car Insurance Policy?

If you can’t reinstate your car insurance policy, you will need to switch auto insurance providers. While switching providers can save you money in some cases, your rates will most likely go up in this case, as you’ve had a lapse in coverage.

Lapses in Coverage

A lapse in coverage is a period of time in which you don’t have an active car insurance policy. That’s a bad thing for multiple reasons, which we’ll detail below.

What Is a Car Insurance Lapse Grace Period?

The good news is that each state has laws on how much time insurance companies need to give you before canceling or not renewing your policy.

Some companies make exceptions if you’re in the military. Progressive, for example, won’t penalize you for a lapse in insurance if you were deployed overseas. In fact, you’ll receive an auto insurance discount, which is never a bad thing. Learn more about Progressive’s auto insurance policies.²

Consequences of Lapses in Insurance

If you drive without insurance, you’ll face consequences from both your insurance provider and your state.

• State fines and penalties: See below for your state’s fines and penalties for driving without insurance.

• Lack of car insurance coverage: Not having car insurance means that you’ll be responsible for the other party’s property damage and bodily injury costs in an at-fault car accident. You’ll also have to pay for your own damages and injuries, all out of pocket.
• Higher rates: When you get insurance again, your rates will typically be higher, especially if you had a long lapse in coverage.
• Repossession of loaned or leased vehicle: If you used a car loan or car lease and let your insurance lapse, your vehicle could be repossessed.

Why Is Car Insurance So Expensive After a Lapse?

Car insurance is so expensive after a lapse because car insurance companies will place you into a pool of high-risk drivers. Even if you’ve never had a DUI, SR22, at-fault accident, ticket, license suspension, or revocation, high risk means higher rates.

Recap

To avoid lapses in coverage and having to reinstate your auto insurance policy or switch providers, pay your bills on time. You can even get a discount for being a good payer. We recommend setting up automatic payments so you never have to worry about paying on time. And if you can’t afford your rates, talk to your agent, who may be able to help you find premiums that work for you.