Your first reaction to cancellation of your car insurance might be surprise, then panic. All 50 states require liability insurance on cars you drive on the highway, so now you’re grounded. States enforce this requirement by refusing to renew your driver’s license, your auto registration or your safety sticker without proof of insurance or financial responsibility. Some states use all three methods as a “gotcha.” The states get another opportunity at insurance enforcement if the police stop you or if you have an accident. Your state makes certain that car insurance is available to everyone, but you may pay more than in the past.
Call your insurance agent and ask for reinstatement of your insurance. Discuss the details of the cancellation with your agent and ask for suggestions. Some agents write for several insurers and may be able to place your insurance with another company. If you have homeowner’s or renter’s insurance, contact your agent and ask about bundling or combining your auto policy with your other coverage. You might even get a discount.
Request insurance information from several insurers as soon as you receive notice that your present company is canceling your coverage. You’ll need time to research and find a company that will insure you. Complete the applications as requested and provide honest information about traffic violations, accidents, claims and late payments with your last company. This information is available to the insurer from other sources, so don't fudge.
Contact your state insurance commission or department of insurance through its website or by telephone for names of companies that provide automobile insurance in your area. In states such as Texas, you can complete a form online and get price comparison figures from different companies. California offers low-cost automobile insurance to qualifying individuals.
Work quickly to obtain insurance coverage as some states charge a penalty after giving you a reasonable time to obtain a new policy. The reinstatement fee in Florida, for example, is $150 for the first lapse of coverage. If you can’t locate an insurer after reasonable searching, contact your state insurance department and ask about “assigned risk.” This insurance is more expensive than most, but you’ll have the required coverage and may save yourself a lapse of coverage on your record.
- Fix whatever problem got your last insurance canceled. If you forgot to pay, schedule automated payments taken from your bank account. Take a defensive driving course if you got too many tickets.
- Request a copy of your driving record from your state insurance department if you don’t know the contents. You’ll be better prepared to respond to questions about tickets or other reports.
- Don’t drive without automobile insurance. It’s not worth the risk of a fine or possible jail time.
- Florida Highway Safety and Motor Vehicles: How Do I Notify DHSMV of My Auto Insurance?
- California Department of Motor Vehicles: Insurance Requirements for Vehicle Registration
- Texas Department of Insurance: Price Comparisons/Rate Guides
- Assigned Risk Auto: DMV - MVC Department of Motor Vehicles by State
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