What Is the Effect of a Lapse in Auto Insurance?

Lapse in Auto Insurance

An auto insurance lapse occurs when you are without coverage for any period. Lapses for any reason or any length of time may have an impact on your ability to obtain affordable auto insurance in the future.

Causes of a Lapse

A lapse in insurance coverage can occur a number of reasons that may include nonpayment or simply not driving. People may purposefully allow coverage to lapse due to injury, travel, car troubles, or simply driving less frequently.

Effects of a Lapse

It is recommended to not allow auto policies to lapse because it can significantly affect your rate. An auto insurer won’t know why you didn’t have insurance, and it won’t matter if there was an explainable reason. In addition, it can be interpreted as an indication that you won’t maintain coverage in the future.

Avoiding a Lapse

If you won’t be driving your car for a significant amount of time, you can consider getting an alternative type of policy such as one for tourists who are traveling. This would be preferable to letting your coverage lapse altogether because it won’t result in a substantial rate increase.

If your coverage has lapsed or you need help to avoid a lapse, talk to an experienced insurance provider who can advise you about your options.