How Long till Auto Insurance Cancelled if Premium Unpaid?

You have entered into contract with your insurer when you took out a policy. In that insurance company will pay for your insured losses and you will make the premium payments in due course. If you paid your premium in full you have satisfied your requirements right at the start. However, you may be paying yours in installments in which case there is a chance that you may miss your next payment.

Obviously carriers wouldn’t be happy to learn that you failed to pay the premium installment and failed to meet your obligation. Equally, they come to learn that these things happen and every company has their own way of dealing with these situations. Missed payments affect your credit score too.

Some states legislate that insurers have to inform their policyholders of missed payment and give them time to pay. This could be between 10 to 30 days depending on the company and state. However, some states choose not to get involved in insurance grace periods and let the companies decide. That is why you cannot count on a grace period and expect to remain insured even though you didn’t pay the premium. But there is a high chance your policy won’t be cancelled immediately. However, you should contact them as soon as you realized you missed an installment.

Your provider would inform DMV of the lapse once your vehicle insurance policy lapses due to nonpayment. Since you have to keep your automobile insured by law, DMV will write to you for an explanation or proof of insurance.

If you missed the payment and somehow the notice period is over your insurer may agree to re-insure your car. In most cases, they will issue you a new coverage. If you don’t want to have a lapsed period on your policy you can ask them to backdate the policy. Normally, backdating policies aren’t allowed but in this case they may agree to it providing you confirm you didn’t have accident in the period you weren’t insured.

Changing Insurers: It is best to inform your provider if you stopped your payment because you bought another policy. Otherwise, they would naturally keep billing you and expect you to pay. You may be able to get out of paying it when you prove that you had another coverage in place already. But it is best to inform your previous carrier when you switch companies to avoid getting bills. In any case, you shouldn’t risk your current coverage until you have a replacement policy in place.

Missing your premium and not remedying the situation quickly will leave you exposed to driving without insurance. Regardless of you knowing your policy lapsed or not, driving an uninsured car is a crime. If you know that you missed your payment you shouldn’t drive your vehicle until you make sure the issues are sorted and you have coverage one way or another.

Consequences of driving without insurance are serious. Your license may be suspended, your vehicle may be impounded and your license plate taken away until you come back with insurance and pay the fine. You may also be prosecuted, especially if you cause an accident.

Furthermore, you would be on your own to pay for all the damages to your vehicle and the damages and injuries you caused to others if you ever get into accident when uninsured. You don’t only comply with the law when you insure your vehicle. Buying auto insurance can help you in many ways. That is why you should not only purchase a suitable policy for your automobile but also make sure it remains in effect.

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