January 14, 2010

Snowbirds Can Save Money by Minimizing Insurance on Cars Left Behind for the Winter

Often, the way many northern U.S. residents opt so live out the winter is in some sunny southern locale, such as Florida or California, where the headaches of winter driving and snow shoveling are a distant memory. For these “snowbirds” this means leaving behind their home, most of their possessions and often their vehicles to endure the winter without them. One way for these people to save more money during these months is to minimize the amount of insurance coverage left on vehicles still at home.

The first important thing to know about this process is not to completely cancel any auto insurance policy for a vehicle if going away for the winter. Even if the time gone will total six months or more, canceling a policy will mean no coverage at all for it, even in the event of a theft or fire. Additionally, when attempting to re-insure the car upon returning home, the auto insurance will likely cost much more, as any insurance company contacted will consider the car to have had a gap in coverage. Another problem that can be faced if the car has a lapse in coverage is that it may require a re-inspection by an auto body shop to be considered fit to drive. While the owner may know that the car never left their garage during the period they were away, the insurance company does not, and will likely demand that the owner pay for an often costly inspection of the vehicle.

Instead of canceling a policy on a snowbird car, it is best to first check with the state, as well as the insurance provider, to determine exactly what type of insurance is the minimum required. Often, this will be “fire and theft,” which is a form of auto insurance coverage that prohibits the vehicle from being driven on the road, but allows it to remain parked and still be covered in the event of a fire or a theft of the vehicle. This type of insurance comes with a far lower monthly auto insurance premium, but allows for there to be continuous coverage on the car.

Also be sure to inquire with the auto insurance company if there are any fees for lowering the level of coverage and then increasing it upon return. As well, make sure that this will be under the same policy number currently being used. It would be unfortunate to have to purchase another new policy after coming home because the insurance company considered the two types of insurance to be two different policies.

If diligently researched, minimizing auto insurance coverage on a vehicle when flying south for the winter can be an excellent way to save money.