Are you wondering about the requirements for car insurance? We’ll break down the basics of whether it’s legal to drive without car insurance and with common penalties like suspension of your driver’s license or confiscation of your vehicle.
Do you need car insurance?
Almost every state in the United States requires drivers to take out auto insurance.
New Hampshire is an exception. There the state has no compulsory insurance law, although the state “strongly recommends” that residents take out car insurance. Drivers are also required to have insurance coverage if they are convicted of high-speed driving and other proof of insurance for other driving offenses, including leaving the scene of an accident, may be required under New Hampshire DMV requirements.
You can drive without insurance in Virginia, but you must pay an uninsured vehicle fee, according to the state DMV.
To make sure you are driving with the correct statutory coverage, check with your state’s DMV. You want to know all the requirements and when it is legal to drive without insurance.
What Types of Car Insurance Are Required?
The type of car insurance required varies by state. The minimum required car insurance is not uniform across the country. However, almost all states require some form of personal injury protection and property damage coverage.
Some states also require uninsured or uninsured coverage to protect you from damage caused by other drivers who are not insured.
Inquire with the DMV in your state which coverage is required where you live.
What are the penalties for catching without car insurance?
Driving without insurance can incur severe penalties for those who are not insured in many states, including Florida. Any Floridian who operates a vehicle without insurance will lose their driver’s license, according to Florida Highway Safety and Motor Vehicles.
Results vary by state and circumstance, and repeat offenders can face harsh penalties in some places.
If you drive without car insurance during a routine traffic obstruction:
- Prepare to pay a fine.
- Many states also suspend your driver’s license and registration, which could result in additional reinstatement costs.
- Your vehicle may have been confiscated and you will not be able to get it back until you have paid the appropriate fees and can provide proof of insurance.
If you have an accident without car insurance:
- You will face similar fines and penalties as above.
- You could be held financially responsible for damage and injury, and even death, to someone. Given the potential costs – such as a full vehicle or hospital bills – an accident without insurance could even lead to bankruptcy.
In addition to the legal penalties, uninsured drivers will increase their tariffs significantly. This is because insurance companies place uninsured drivers at very high risk for filing a claim. Even after repaying the initial legal penalties for driving without insurance, the increase in car insurance tariffs can result in years of financial consequences for uninsured drivers.
Is there an easier way to get car insurance?
If you get caught without car insurance, the costs can add up quickly. It is safer and easier to get affordable car insurance.
An insurance agent can walk you through all of the auto insurance options and help you find a plan that fits your budget.
How many uninsured drivers are there?
According to the latest data from the Insurance Research Council, around 13 percent of vehicle owners across the country drive uninsured.
States with the most uninsured drivers::
- Florida: 27 percent
- Mississippi: 24 percent
- New Mexico: 21 percent
States with the fewest uninsured drivers::
- Maine: 5 percent
- New York: 6 percent
- Massachusetts: 6 percent
What if your car insurance expires?
Typically, short coverage gaps aren’t a big deal. Your policy or state may have a grace period within which to renew an expired policy. Check with your insurance policy about the grace period, as many give you 10 to 20 days of leeway.
However, you also need to know the state laws. Florida insurance companies notify the state as required by law for motorists with insurance gaps. The Department of Road Safety and Motor Vehicles will then ask for proof of new insurance coverage, known as the SR-22 form. If proof is not provided, you can suspend your license, label and registration for up to three years, plus a fee to restore all data.
Can you interrupt your car insurance when you are not driving?
If you take a break from driving, you technically do not need to continue your car insurance. However, this approach has several drawbacks. If you put your car insurance on hold, insurance companies can classify you as a high risk driver. As a result, when you reintroduce your policy, your insurance rates will increase.
So think twice before breaking your auto insurance. It may also not be an option once you have financed your car, as lenders usually require car insurance.
After buying a car, can you drive without insurance?
Usually, when you buy a car from a dealer and finance the vehicle, it is not legal to drive without insurance. You cannot leave the dealership without showing that you have car insurance.
Uninsured drivers must take out car insurance before buying a car. If you are insured and deal in your car, some policies have a grace period that allows you to transfer your policy to the new car within a week of purchase.
Always check with your insurer for the details of your policy before buying a car. You don’t want your car parked and damaged by a storm or anything else until you have cover.
Can you rent a car if you don’t have insurance?
Usually no. Generally, if the borrower does not have their own auto insurance coverage, the owner’s policy does not extend the coverage ratio.
Insured drivers who borrow a car are usually covered by the owner’s insurance policy. This is due to a “driver allowed clause” that covers infrequent loans to people outside the household.
The general rule of thumb is that car insurance follows the car while traffic violations follow the driver. However, after an accident, the financial responsibility between the car owner’s insurance plan and the car borrower’s insurance plan can become murky. Most insurance agents recommend that policyholders contact them. They also suggest not lending a car or other motor vehicle to underinsured or risky drivers, including those who may learn how.
Check with your insurer about regulations and see if there are regulations in your state.
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Renee Valdes contributed to this report