July 15, 2009

Auto Insurance Being Dropped by US Drivers at a Fast Rate

According to Insurance News Net, more and more Americans are dropping their auto insurance policies and are ignorant of the consequences.

In a 2009 comSource survey, an overwhelming majority of respondents–72%–did not know if their auto insurance rates would increase if they dropped their coverage and attempted to reinstate. A uniformed 15% replied that they thought their rates would not increase. What this data suggests is that misinformation may be an important component in the recent deluge of Americans who have decided to cut back by dropping their auto insurance.

Certainly, drivers from all walks of life can sympathize with those who have dropped their policies due to economic hardship, which is probably the most predominate and direct cause of dropped auto insurance policies. As the unemployment numbers rise and salaries are cut, most Americans have realized they need to save. For many, dropping their auto insurance policies is an obvious answer. If you're a safe driver, you probably haven't used your auto insurance policy recently. Similarly, you may even think you can skate by the legal requirements for minimal coverage because you tend not to be pulled over. And because–as the survey results state–you think you won't have to face increasing rates, it's tempting to let this one bill go.

For just these reasons, the Insurance Research Council has found that one out of every six U.S. drivers will be operating a vehicle without insurance by 2010. But no matter how tempting it sounds, you don't want to be one of them. Why? First, driving without car insurance is illegal and can not only earn you fines, but also a suspended license. Even less than affordable auto insurance is cheaper than the fines in most states. If you drive without insurance and cause an accident, you might be stuck with a bill for thousands of dollars, in addition to the legal fees you'll most certainly have to pay when you file for bankruptcy.

Second, contrary to popular belief, even companies offering affordable auto insurance will increase your rates if you disengage your policy and then attempt to reinstate. You may be faced with the pressure of having low income now, but dropping your car insurance is not worth the price of having to pay more in the long run.

Affordable car insurance rates are out there, and you can get them if you do a little research. With comparable car insurance quotes that can be obtained for free online, discounts that cater to students, the elderly, homeowners, and other special circumstances, and multiple companies to choose from, you can beat the current depression without dropping your essential car insurance.