June 20, 2011

Three Steps To Follow If You Lose Auto Insurance Coverage

Losing auto insurance coverage is a serious problem that needs to be taken care of as soon as it occurs. Each state has minimum coverage requirements that need to be adhered to. Penalties for driving without insurance are quite serious and can include hefty fines, and in some cases driver's license suspension. Even worse, if you are involved in an accident and found to be at fault you will pay all of the other driver's expenses out of pocket. This includes their repairs as well as medical bills. There are three steps to follow if you lose auto insurance coverage.

The first step you should take upon being canceled is to contact your insurance agent. He or she can tell you why you were canceled. In some instances you may be canceled because there were forms or waivers that did not get signed or your premium did not get paid in a timely fashion. Situations such as these are sometimes fixable, and your insurance company may reinstate your policy, if you take care of the issues that caused the cancelation. Unfortunately, if you were canceled because of excessive speeding tickets, a reckless driving charge, or a DUI, in most cases your insurance will not be reinstated and you will be left without coverage.

Your second step will be to start shopping for a new auto insurance company. In today's market there are many companies that offer minimum state coverage, and are willing to insure a high risk driver. Some companies charge more to insure a driver that comes to them with no insurance. Also, your status has probably changed to high risk if you were canceled for driving violations, so you should probably be prepared to pay significantly higher premiums than you were paying before.

Your third and final step is to learn from your experience. If you experience loss of coverage from non-payment, make sure you pay your premiums. Most companies offer automatic payment options. Your payments are taken directly from your bank account on the same date each month alleviating late or non-payments. If you lost coverage because of a bad driving record, be cautious and avoid any more citations or charges. With the exception of DUI's, most driving convictions fall off of your record after 3 years, so it is possible to improve your status from high risk driver with time.

Auto insurance is an important necessity. It is the law that all drivers carry it. Besides that fact, it protects drivers in case of accidents. All drivers need to do whatever is required to obtain insurance, and keep it once they have it.