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Even if you are not driving your car, you are legally required to insure it. With more people working from home since the pandemic, auto insurance may seem like a sunk cost since you are less likely to make any claims.
However, even when you are not using your car, you still need protection. The type of insurance you choose depends on factors such as the area you live and whether the car is financed or fully purchased. Legally, you must have at least third-party coverage.
Typically, law enforcement can check whether your car is insured through the Motor Insurance Database. If the car is uninsured, they can seize it immediately. However, there are some instances in which you do not need car insurance.
When I Do Not Need Car Insurance?
In some cases, you may need car insurance. These include:
● Statutory off road notification: A valid SORN certificate allows you to have an uninsured car
● Your vehicle is off the road: If your car has been off the road since 1 February 1998, it can be legally uninsured
● The car is still with the dealer: If you are in the process of buying a car and it is still held in stock at the dealership, you do not need to have car insurance
● The Car is totaled: If your car cannot be used as a result of an accident, you do not need to have insurance. In this case, you are required to provide sufficient notice.
● The car is unregistered: If your car is registered in the state you live and the registration remains active, you are required to have insurance. Of course, this is dependent on your state laws. However, if you have a car that is unregistered, you do not need to pay insurance.
Uninsured cars will usually get a warning notice from the Motor Insurer’s Bureau to insure the car. If your car appears uninsured, but you have insured it, you will need to check that your provider entered the correct details into the database.
If, after the notice, your car remains uninsured, you may get a Fixed Penalty Notice. It may also be clamped, seized, or destroyed. You may also be taken to court.
Why Do I Need Car Insurance If I’m Not Driving My Car?
Even when you are not driving your car, it is still at risk of collision with moving vehicles, vandalism, theft, or damage by natural events. Having insurance protects your valuable investment from these unexpected events.
Insurance is also critical for collectors as it ensures that your invaluable vintage or classic car is protected in any of these events.
How To Cut Insurance Expenses When You Are Not Driving
If you do not plan on using your vehicle for a considerable period, you can reduce your insurance costs by:
Canceling Your Car Insurance
Canceling your car insurance is unwise as it leaves you vulnerable to many events which might lead to costly repairs and replacements. It is also illegal in most states and, when extended, might leave a gap in your insurance history.
As a result, future insurers will consider you a high-risk driver and charge you more in premiums. If your car is not worth a lot, this may be the best option to save money on insurance.
Suspending Your Coverage
In some states, you may be allowed to suspend your car insurance. This is considered better than canceling your insurance as most insurers do not consider it as a lapse in your history. It might also reduce your insurance costs in future policies.
However, once you suspend your coverage, you remain unprotected in case of vandalism, theft, and other events. Even if you are trying to save money, suspending your insurance is still more expensive than buying a new car.
Reducing Your Coverage
This option allows you to save money but you still remain protected in case of unexpected events. While most states have minimum coverage requirements, if you carry comprehensive insurance, you can save money by choosing a cheaper policy.
If you are reducing your coverage, to reduce their risk, most insurers will require you to keep the car in secure storage rather than the driveway or garage.
Other options to save money on insurance include:
● Eliminating extras such as roadside assistance
● Low-mileage, usage-based, or pay-per-mile insurance
● Asking your insurance provider about discounts
● Increasing your deductible
● Shopping for a cheaper insurance provider
● Improving your credit score.
Summary
While it would be easy to cancel your insurance policy simply because you are not driving your car, the reality is that not having it insured puts you at risk of paying for any repairs or damages out of pocket.
Fortunately, you can reduce your insurance expenses without putting your financial health at risk. Contact your insurance company to find out which options are suitable for your needs.
