Auto Insurance Non-Renewal vs. Cancellation – Forbes Advisor – Forbes
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A canceled car insurance is different from a car insurance that is not renewed. Non-renewal occurs if your insurance company terminates your contract at the end of the insurance period. Cancellation usually occurs if your insurance company cancels the insurance cover during the term of the policy.
Reasons to cancel your car insurance
There are several possible reasons for canceling car insurance. The most common reasons are late payments and failure to disclose information on your motor insurance application.
Other possible reasons for a canceled car insurance are:
- Your driving record is badsuch as too many culpable accidents or violations over a period of time, such as 36 months.
- Your driver's license or registration will be suspended.
- You have fraudulently claimed your car insurance, e.g. B. false information about a car insurance claim.
- You have been convicted of a crime like driving under the influence of alcohol.
- You are driving for a rideshare company like Uber or Lyft and haven't notified your insurance company.
- You have a disease that makes you an unsafe driver. For example, in Illinois, auto insurance can cancel your auto insurance if you are diagnosed with epilepsy and your doctor cannot demonstrate that your epilepsy will not affect your ability to drive.
Reasons for not renewing car insurance
A non-renewal occurs if the insurance company decides not to continue the insurance cover after the policy has expired. Here are the most common reasons for not renewing:
- Your insurance company decides to cease operating in your state, or sell fewer policies in your area.
- You made late payments for car insurance.
- You have entered incorrect or fraudulent information on your insurance application.
- You have caused multiple removal certificate violations or car accidents.
Note on the non-renewal or cancellation of the car insurance
If your policy is not renewed or canceled, your auto insurance company will send you an advance notice with a justification. The timeframe will vary depending on state laws and circumstances, but you will typically receive a notification 30 to 60 days prior to the cancellation date. If it is not renewed, it is usually 10 to 75 days.
How to get car insurance after a non-renewal or cancellation
After receiving notification that your policy is being canceled or discontinued, you should act quickly to get new insurance before the cancellation date. What's the rush? Your insurance company is required to contact your state's automotive department as soon as a motor insurance policy is canceled.
If you can't find new coverage, your state may require you to surrender your car's tags and give up your driving permissions.
You also want to avoid an insurance loss or uninsured period between policies. If you don't get a new policy quickly and are not insured, you cannot legally drive a car. If you drive uninsured and cause an accident, you will be responsible for paying medical and repair bills.
If you are caught driving without insurance, you also face fines and penalties. Additionally, after an insured event, you will typically pay more for auto insurance as the freight forwarders view coverage gaps as risky behavior.
How to get insurance coverage after a non-renewal or termination and still save money:
Determine adequate coverage. It is wise to get adequate liability insurance that is worth the value of your savings, home, and other assets. Avoid getting only the minimum liability insurance required to legally drive in your state as it may not be enough to cover even minor accidents.
Research auto insurance. You don't want to choose a company based on price alone. Customer service and claims handling are also important. Find the best auto insurance policies on your shortlist by researching rankings and reviews.
Compare shop and ask for discounts. Compare car insurance quotes from multiple providers for the same amounts of coverage. This is the best way to make savings or you won't know what the companies are asking for.
Even if you have multiple violations, a DUI, or multiple accidents, you will find that some companies charge a lot less than others. Make sure any driver discounts you are eligible for are applied.
Buy your policy and set the expiration date for the day your old policy expires. Make sure your new policy is valid when your old policy ends. In this way you avoid gaps in insurance and do not drive uninsured.