No- not the dreaded thigh gaps. Gaps in coverage for your auto insurance!
Insurance companies take many factors into consideration when they determine your car insurance rates. These factors include your car’s make and model, your gender and age, and your claim history.
Another important factor is your car insurance history, whether you’ve had any lapses in coverage, and whether you’ve driven while uninsured.
What is a lapse in coverage?
A lapse in coverage, also referred to as a gap in coverage, is any period of time where you do not have car insurance. There are several possible reasons for a gap in coverage:
- You forgot to pay your premium on time.
- Your car insurance company cancelled your policy.
- Your car insurance company went out of business.
- You lost your license and allowed the policy to lapse.
- You decided to no longer drive or own a car for a personal reason, including being out of the country.
Not having to make payments on your insurance will save you money. However, unless you plan to never drive again, your savings may be short-lived. Insurance companies look at your insurance history as one method of determining your premium. You may be considered a “high-risk driver” if you’ve let your coverage lapse or if you were driving and/or in an accident while uninsured.
Once you are considered “high-risk,” you will likely find that your new car insurance rates will be significantly more expensive than if you had continued your former policy. You may even be denied coverage by providers in the open market, at which point you would need to obtain insurance through your state’s automobile insurance plan, which can be much more expensive.
Almost all states require that drivers have some type of car insurance or financial bond. This means you’ll end up having to purchase car insurance again if you plan to drive at all. If you drive without reinstating your auto insurance and get caught without the minimum required insurance coverage, you can face:
- Driver’s license suspension.
- SR-22 proof of financial responsibility filing requirement.
- Jail time.
Even more significant are the costs associated with an accident while uninsured. You could end up owing thousand of dollars you can’t pay without the appropriate coverage. If this occurs, you could risk losing valuable assets, such as your home.
Please be advised that the risks of driving without insurance are extremely high. Contact us if you have questions about your insurance policy, and check in frequently to make sure you are adequately covered. We appreciate your questions and want to make sure you have “Peace of Mind. Ensured”.
Photo credit: Think Elevate