What are the Consequences of Driving Without Insurance?

Posted in Auto Insurance by admin

If you are thinking about canceling your car insurance to save money, you may want to think twice about that decision. It’s true that car insurance can be costly; some factors, like an unsafe driving history or choosing to drive a high risk vehicle, will cause you to pay more for your car insurance. There are some consequences that you may face if you drive without car insurance, however, that can make going without it more costly than paying the premiums. Before you cancel your insurance, you should fully understand what the consequences may be.

Your State’s Penalties
In most states across the U.S., drivers are obligated by state law to carry a minimum amount of car insurance. This requirement usually dictates a certain amount of liability coverage. Some states also have requirements for Uninsured Motorist coverage and Personal Injury Protection. In addition to requiring coverage, each state has specified penalties for drivers who do not meet coverage requirements. These penalties will vary by state, but most include provisions for a monetary fine, the suspension or loss of a driver’s license, the suspension or loss of vehicle registration and even serving time in prison in certain cases.

Your Lender’s Penalties
While most states have minimum insurance requirements, many lenders and lessors have insurance requirements as well. They generally differ from state insurance requirements, which means drivers may be required to purchase even more coverage. Typical coverage requirements may include gap insurance maintenance, collision insurance or comprehensive insurance. If you fail to maintain the required coverage, the lender or lessor typically can purchase the required insurance on your behalf. The insurance coverage purchased by a lender or lessor may be more costly than the coverage you could buy yourself.

Out-of-Pocket Expenses
As a driver, you should be aware that you are financially responsible for all damages you cause with your vehicle. This includes damages to other vehicles, medical expenses others face as a result of your actions, and property damage. This is coupled with your own accident expenses as well, as you may need to repair your own vehicle, replace property inside of it that was damaged or pay for your medical expenses. If you do not pay for damages you cause to others, they can take you to court and sue you for damages. You will be faced with court costs which can affect your credit rating.

While car insurance can be expensive, it is far more expensive to not carry the proper amount of insurance. There are steps you can take today to find more affordable car insurance coverage. For example, you can get several quotes from sites. You can also adjust your coverages so they protect you, but you’re not over-insured. Increasing your insurance deductible can also make car insurance more affordable. The fact is that car insurance is a required cost of driving, and it can minimize your out-of-pocket costs and liability behind the wheel. Take time to shop for more affordable coverage today to avoid facing the unpleasant consequences associated with being uninsured.