Why bother paying for a car insurance policy when you can’t even drive your car? Well, you don’t necessarily have to.
Whether you are going on a long vacation, moving to a new country, or simply can’t drive your car for an extended period of time, it may be possible for you to cancel or suspend car insurance to reduce your monthly bills.
Read on for all the details you need to decide whether to suspend car insurance temporarily and the best way to proceed.
Why Get Rid of Car Insurance Temporarily?
Each state retains its own laws regarding car insurance, but it is generally permissible for a car to be uninsured if it is parked in a private location, such as a garage or driveway.
But why bother getting rid of your auto insurance in the first place? The most obvious reason is to save money on unnecessary bills. If you do not plan on driving your car for an extended period, then canceling or suspending your insurance might be right for you.
However, there are a couple things to keep in mind before investigating your options.
- Never cancel or suspend car insurance if you plan on driving your car. Driving an uninsured car is dangerous and even illegal in most states. It could result in a massive financial obligation, including lawsuits and fines if an accident were to occur.
- Remember that if you do suspend or cancel your car insurance, you will no longer be covered for accidental damage or theft. If a tree falls on your parked car, someone breaks into it, or you experience any other issue, you will be liable for the cost.
If your vehicle is having engine trouble and is inoperable, you might also be wondering, do you need insurance on a car that doesn’t run? The answer depends, but suspending insurance coverage might be better than canceling altogether until you know the extent of the damage.
Options for Reducing Your Monthly Car Insurance Costs
There are typically two options available to drivers who want to get rid of their monthly insurance costs when not using their car:
- Suspend your auto insurance premium – Most policies will permit you from suspending coverage for a given timeframe.
- Cancel your auto insurance premium – You can cancel your auto insurance coverage altogether and then find a new policy once you are ready to begin driving again.
You might also be able to switch to a pay-per-mile scheme or drop extra coverage on your auto policy. This will likely reduce your monthly spend in the short-term but could wind up costing you more if you decide to return to your initial coverage.
If you cancel, you may end up needing temporary car insurance, which is an expensive car insurance option.
Suspending Your Car Insurance – Benefits and Drawbacks
If you are looking to reduce insurance costs for just a month or two, suspending your car insurance is right for you.
Note: Not every insurance provider will allow a policyholder to suspend their insurance, so make sure to check your policy before considering this option.
The main benefits of an auto suspend include:
- Eliminate your monthly costs
- Avoid suffering from a lapse in coverage that could adversely affect your future insurance rates
- Quickly reinsure your motor vehicle once you are ready to begin driving again
- Illegal to drive your car while the insurance is suspended
- No protection from accidents or theft if something happens to the car during suspension
- Not possible for some policyholders
- Individuals with auto loans are not eligible for suspension
If your policy permits a suspension, contact your provider today to learn more about minimum timeframes and suspension fees.
Canceling Your Car Insurance – Benefits and Drawbacks
If you don’t plan on driving your car for a longer timeframe or your policy doesn’t permit suspension, then you might want to consider canceling your insurance and purchasing a new policy at a later date.
The major benefits of this option include:
- Eliminates monthly insurance costs
- Available to all consumers—every policy permits cancelation
- Provides you with unlimited options when you are ready to purchase a new policy
- Like suspension, you are unable to drive your car while uninsured
- No protection from accidents or theft if something happens to the car without coverage
- The lapse in coverage could increase your future rates
- Individuals with auto loans must have car insurance, thus are ineligible for cancelation
While canceling your car insurance is final, you can easily find a new policy once you are ready to begin driving again. If you want to know how to cancel car insurance, call up your provider to learn more. Or, see our guide on how to lower car insurance rates before you decide to cancel.
Compare Rates Online
Whether you decide to cancel or suspend registration for car insurance, you can find the best deal on a new policy by comparing insurance company rates across providers through Online Auto Insurance. Get a quote in seconds to find the right car insurance company for you.
Plus, here you can access tons of useful car insurance guides like Buying a New Car Insurance Grace Period, and more.
California Department of Motor Vehicles. Vehicle Registration Suspensions and Insurance Program (FAQs). https://www.dmv.ca.gov/portal/dmv/detail/online/vrir/vr_sb1500qa
Glover, Lacie. How to Pause, Cancel or Reduce Your Car Insurance. https://www.nerdwallet.com/blog/insurance/how-to-suspend-your-car-insurance/
Metz, Jason. COVID-19’s Impact On Your Car Insurance. https://www.forbes.com/sites/advisor/2020/03/26/covid-19s-impact-on-your-car-insurance/#6d1e657f6515