Okay, so you have a situation: the car insurance didn’t get paid. Maybe you forgot. Maybe money was a bit tight this month and you couldn’t pay it. And now your Atlanta car insurance has lapsed…and you’re a little anxious. Your main question is what do I do if my car insurance lapsed? And what could happen now that your auto insurance has lapsed? We’re going to answer those questions by explaining what to do if your car insurance lapsed…and why it’s important to get coverage in place.
What do I do if my car insurance lapsed?
Well, the first thing is to stop driving the car. When you haven’t paid the bill, your car insurance stops. Which means you’d be driving with no insurance…and that’s illegal in the state of Georgia. More on that later. Anyways, mooch rides from friends, take public transportation, use a ride-share service…just don’t drive. There are a lot of potential consequences to driving without insurance (and we’ll go over that in more detail in just a second.)
Okay. Moving on.
You need to call your agent or your car insurance company. You might be able to reinstate your policy without too much trouble if you’re not too late with the payment – particularly if you’ve got a good driving record and if you don’t make a habit of paying your car insurance bill late. Your insurance company might forgive a “whoops” moment.
But if it’s more than just a “whoops” situation and your insurance has been lapsed for a long time, that could be a problem. You’ll have to talk to your agent and see what options they have. The insurance company has a procedure to follow when it comes to nonpayment. They may use your old policy, or they may just have you apply for new coverage. The thing about reapplying is that your rates are probably going to be quite a bit higher than they were before – now that you have a history of nonpayment, you’re more of a risk.
Another potential outcome is your insurance company canceling your policy. And if your insurance company decides that they’re not going to cover you anymore, you’re back to the drawing board and you’ve got to shop for new auto insurance. And again, you’re probably facing some pretty hefty Georgia car insurance rates. A new insurance company is probably going to be pretty leery of insuring you because they see you as being a risk. To be blunt – they want to get paid.
So, long story short: if your car insurance lapsed, call your insurance agent to find out what your options are.
Pro tip: Set up automatic payments for car insurance. Then the bill will always get paid because it’ll be automatically be deducted from your bank account.
What happens if I drive without car insurance?
As we mentioned, if your car insurance bill has not been paid, your car insurance has lapsed. And if your car insurance has lapsed, you don’t have car insurance.
Well, that could get problematic.
In Georgia, you’re legally required to carry liability insurance to drive on the roads. You need $25,000 bodily injury liability insurance per person and $50,000 bodily injury liability per accident. You also need $25,000 of property damage liability. Those are the Georgia state minimums for car insurance. If you’re not covered by those levels of insurance and you get into an accident or get pulled over, that’s big trouble. Like we said, it’s illegal to drive without the right insurance.
But wait – there’s more.
If your car insurance lapsed, you would have no insurance to protect you if you’re at fault in an accident.
That means you would have to shoulder the cost of…
- The medical bills/expenses of the driver and their passengers.
- Repairing/replacing the other driver’s car.
- Repairing/replacing your car.
- Legal fees and expenses if the other driver sues you.
- The court-ordered judgment that you have to pay to the other driver.
These expenses would be coming out of your pocket because you have no safety net in the form of insurance to catch you. Sure, your insurance premium might seem expensive…but not as expensive as the fallout from an at-fault accident. You don’t want to have to cover those expenses on your own.
What if I have a car payment and my car insurance lapses?
If you’ve got a car payment and you’re paying off a loan to a lienholder or leasing company, you will probably be required to carry not only liability insurance (as per Georgia law) but collision and comprehensive coverage as well. (These are the coverages that will repair or replace your car if it’s damaged by a covered loss.) Your lender wants to protect their investment in the vehicle, and if they’re made aware of the fact that your car insurance lapsed they could respond by putting force-placed insurance on your car.
Basically, force-placed insurance means they’re going to get insurance for your car…and then get you to pay for it.
Now, a couple of things to know about force-placed insurance:
First, it’s usually very expensive.
Second, it still may not provide high enough limits of insurance to fully protect you if you’re involved in a car accident. The limits may not be very extensive. So. If you do find yourself in the position of having force-placed auto insurance, be sure to check and see what it covers (and verify that it satisfies the state minimum levels of insurance.)
So. This is why it’s important to keep valid Atlanta car insurance. Though you may feel auto insurance is very expensive, consider it an investment in your financial security. No one wants to think about worst-case scenarios, but driving comes with a lot of risks. It’s essential to protect yourself financially. If you’re concerned that car insurance is going to be too expensive, reach out to your agent and ask about payment plans, discounts, and coverage options.
And your Atlanta Insurance agent can help you shop for your rates so that you can compare coverage options and pricing – and save money on your car insurance. Get started with your Atlanta car insurance quotes by filling out our online quote form or giving us a call.