What Can I Do If My Car Insurance Is About To Lapse?

By Mike Anderson Posted in Car Insurance News

A lapse in car insurance coverage is when your policy has been canceled due to failure to pay the premium or you have done something to void the conditions of your contract. You can void your insurance policy if you do anything that violates the terms of your contract. If you provided false information to your insurance provider, false name or address, when you signed up for your policy. Also, if you alter your car in a way that could affect its drivability then your policy could lapse.

What This Means For You

It is very difficult to find an insurance company willing to insure you if you allow your policy to lapse. There are very few insurance companies that will insure drivers if you have let their policies lapse. The biggest reason is the possibility that you will lapse with them also. It will also affect your credit rating because the insurance companies will report the lapse to the credit bureaus. When you are able to find an insurance company that will insure you be prepared to pay handsomely for it. Your rate will definitely increase and any discounts you were eligible for previously will be null and void. You will have to complete a cycle, usually one year, of making your payments diligently before you will be eligible for discounts.

There are also deeper consequences that will resonate throughout your financial dealings. Your credit card interests rate may increase when the credit card companies review your credit rating. It will also be more difficult to get a home loan or any other type of loan. You could also be putting yourself at risk for having your license taken away if you continue to drive once your insurance has lapsed.

How You Can Fix It

Some insurance companies are willing to work with you on making payments. If you call the insurance company before your payment is late they may give you a little extra time to come up with the money or they may allow you to change your policy to reduce premium amounts. There are some insurance companies that will insure you if your policy has lapsed.

Related posts:

  1. How To Get New Car Insurance After A Lapse?
  2. Why Is A Credit Report Important For Young Driver Car Insurance?
  3. When Is An Auto Insurance Policy Considered Lapsed?
  4. How Do Car Insurance Companies Determine Insurance Rates?
  5. Which Auto Insurance Companies Take Clients Who Have Lapsed?

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