Don't Think Continuous Car Insurance Is Important? Think Again!

Cancelling your continuous car insurance when the finances get tight is one of the foolish ideas that you have ever thought. Not to mention that you will be driving illegally by cancelling mandatory liability insurance.

By driving without any insurance you are setting yourself up for an additional driving violation ticket if you are pulled over by a police officer for any other reason. On top of the fine for the ticket, when you do purchase insurance again you will be paying more for your premiums than you were when you cancelled your policy. After all of these new expenses you will find that you really haven't saved yourself all that much money from dropping your insurance coverage and making a lapse with your continuous car insurance.

Think About Losing Your Discounts

Having continuous car insurance with an insurance company can qualify you for credits. The credits are basically a thank you from the insurance company for staying with them and is usually known as a longevity discount. Any credit that you are offered by an insurance company for basically doing nothing is a positive thing as it lowers the amount of premium that you have to pay.

However, if you cancel your insurance you will lose this credit as it creates a hole in your continuous car insurance coverage. Even if you do return to the very same company, you still have to start at the beginning of the set time frame in order to qualify for the discount again in the future.

Think About It Hard If You Live In California or Texas

Both the states of Texas and California electronically track their drivers through a database. Every business that sells insurance in these states have to report to the database each time you drop or purchase insurance coverage.

If a business reports that you have cancelled your continuous car insurance coverage, you have a specific time period to replace that coverage with a new insurance policy. If you don't get new insurance you are required to surrender your plates and stop using the vehicle that is not insured. Failure to comply with either one of these steps will result in suspension of your registration and fines.

If you reside in another state don't think you areoff the hook to not have insurance, each state has their own set of fines for failure to keep continuous car insurance.

Think About Owing Money For The Rest of Your Life

Dropping continuous car insurance is not only a bad idea legally, but financially also. Consider the situation if you were to get into a car accident. Not only are you most likely going to be issued a ticket for not having insurance; if you are at fault, you will have to pay for all the damages out of your own pocket. Very easily there will disapear all of the dough you saved by not keeping continuous car insurance on your vehicle, plus more.

The price of damages in an accident can reach amounts that are staggering, especially of you caused an accident that had injuries. Medical costs and damage awards for pain and suffering quickly raise the total cost of an accident; all of which you will have to pay on your own as you have no insurance.

Even if the other person's insurancepaid for the damages initially, they will take you through subrogation and even court if they have to. The term subrogation means when an insurance company goes after the person that was responsible for causing the car accident. They go after them to get the money that they paid out for the accident and also the deductible amount that their customer had to pay.

While they will allow you to make payments on the cost of the accident, you will most likely be trying to pay this off for the rest of your life.

Think About Being Placed In High Risk Insurance

After you have had to deal with all of the fun of being caught with no continuous car insurance, you get to go out and purchase insurance again. But, this time you are looking at having to most likely purchase SR-22 insurance. Not only does this get you rated in high risk insurance, which is significantly more pricey than the main car insurance market, it also creates an additional surcharge on your premium.

Still think that cancelling your continuous car insurance is such a good money saving idea?


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Todd Clay was an agent for the largest insurance company in the US. He now researches and blogs about continuous car insurance with the consumer in mind. Check out the latest reviews, rates by state, or grab a few auto insurance quotes in 5 minutes at: www.CarInsuranceGuidebook.com