
Why Letting Your Auto Insurance Lapse Can Lead to Trouble
Auto insurance is vital for financially protecting your vehicle and your wallet. When money is tight, dropping insurance coverage may seem like an appealing option; however, doing so could expose you to significant out-of-pocket costs after an accident. Consider the following situations where lacking auto insurance could spell trouble:
You Hit Another Vehicle
Most states, including Louisiana, legally require some form of auto insurance for drivers. If you don’t have auto liability coverage and get into an accident, you may face legal penalties and even lose your license. Additionally, if your coverage limits are too low, you may need to pay for the other party’s losses out of pocket, including their vehicle damage and medical costs.
Your Car Gets Hit
If your vehicle is hit in an accident, the other party may pay for it; however, this isn’t guaranteed. For one, if you’re partially at fault, the total cost likely won’t be covered; for another, if the other person doesn’t have enough insurance, you’d need to cover the remainder.
In these cases, having your own auto insurance can be vital for receiving swift financial compensation. Specifically, collision insurance can help pay for your car’s damages, regardless of fault. If you get injured, MedPay can help cover your medical bills. Without coverage, you may be waiting for the other party to provide compensation, which may ultimately not be enough to cover your losses.
You Need to Renew Insurance
Let’s say you let your auto insurance lapse and you decide to get a new policy one day. If you have a gap in your insurance history without legitimate reason, finding an affordable—or any—policy may be more difficult. That’s because having lapsed insurance makes insurance companies perceive you as a higher risk. This means your only option may be nonstandard auto insurance, which is often more expensive.
The Bottom Line
There are numerous reasons why letting your auto insurance lapse is a risky move. Don’t put yourself on the hook for significant costs after an accident. Instead, work with an insurance professional from The Insurance Center of New Orleans. We have the expertise to find you an affordable policy that fits your needs. Contact us today to learn more.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.
Categories: Auto Insurance, Blog