Do US auto insurers penalize uninsured motorists?

Question

I'm turning 25 at the end of August, and my insurer has told me they are canceling my current policy on 8/27 if I do not pay today. That's fine with me, because my premium is so high right now due to 4 at-fault accidents on my record (& the fact that I live in an expensive-insurance zip code). Two of those accidents come off my record starting in September, and due to that and my age change I'm thinking my insurance would come down $800-$1000 less than the premium I'm paying now for 6 months (over $2000). The penalties accrued in my state amount to $175 for re-registration of an uninsured vehicle, and I figure if I go to the DMV right away with my new insurance card, explaining that I did not drive my car between 8/27 and 9/1 (or whenever my new policy starts), I can get away without any additional court fees or tickets on my record. But I'm wondering what the insurers will think if I try to sign up for insurance without any preexisting. Do they penalize (with rate hikes) for this?

Answer 1

Sounds like you are trying to cheat the system. That can cause you a lot more harm than you are trying to prevent.

If you cancel or let your insurance lap, this will become part of your insurance 'history' and put a black mark on your insurance record. You will end up having to pay more to start a new policy and your rates may even go up. Check with your agent, before you take any action. You got yourself into a mess and it's your responsibility to face the consequences.

Answer 2

What I have experienced in the past. If, you not have insurance they do charge a higher rate, but, it usually go down in a year with a good driving record. In your case it going to be high until those accidents are around 3 years old.
Story time; My Aunt was grumping about her liability insurance seem high and call the company. She tell them she have a good record and not understand. The man say, that the rates. She ask, "What would it be a month if I had a ticket or accident"? He laughed and said; "You not want to know, but, it be 3 figures"!

Answer 3

Not all states require it. In Texas for example: In Texas the uninsured motorist / under insured motorist (UM/UIM) that is required to be offered to you by auto insurers can be for bodily injury and property damage. While it must be offered, you are not required to purchase these coverages. If you do reject it, it must be in writing. It's similar in other states, they are required to OFFER it, and it's a good idea to have it, but you can reject it. If you do, pray you are never hit by an uninsured driver.

Answer 4

They will likely raise your rates and demand prepayment for the entire six month or full year of coverage up front. Also, if you get a single citation while you are uninsured you can't do the "liar's affidavit" stating you didn't drive the car.
Also, you will be breaking the law, and if you have an at-fault accident (as you are obviously prone to do) you can be sued for all damages and lose everything.

Answer 5

If you have any gap in coverage they are likely to penalize you. If you will be uninsured, even for a few days, legally you must turn your tags in and de-register the vehicle. Under those circumstances you would not have a gap in coverage that would matter as you did not have a vehicle on the road without insurance.

Answer 6

Generally not if it is not for more than 30 days. You can pay and then send them a certified letter canceling the policy and they must refund from the date the letter was received.

Answer 7

Hmm...4 at fault accidents and you don't want to maintain your insurance. Then don't drive, its quite obvious you are nuisance on the roadway anyway.

Answer 8

You'll be penalized for having insurance cancelled.

Answer 9

If your insurance lapses, you will have a difficult, if not impossible time obtaining new coverage. I don't understand how people can be so cavalier about insurance. It isn't an option, it's a legal requirement.