The state of North Carolina mandates all owners/operators of vehicles to have auto liability insurance, but what happens when your N.C. car insurance is canceled for non-payment? Not having car insurance, regardless of the reason, can be detrimental in many ways so finding out what you can do if your policy is canceled is monumental.
What a Canceled Policy Means
If you receive notice that your insurance carrier is canceling your auto policy that means your policy is completely terminated at the stated date. When you initially sign on the dotted line for auto insurance, you are in a “binding” period for the first 2 months and your carrier can terminate your car insurance policy for any reason. However, once the initial time period has lapsed, your auto insurance carrier must have an exact reason for canceling your policy. Some typical reasons for a cancellation of an auto insurance policy may include the following:
- Medical diagnosis that may impair your driving condition (epilepsy, onset of blindness/blindness)
- Revoked/Suspended drivers license due to DUI or similar offense
- Failure to pay your insurance premiums
- Misrepresenting any information on your insurance application
Suffering the Consequences Can Be Challenging
Having a canceled car insurance policy means that you can no longer drive your car (legally) since you don’t have any coverage in place. The consequences of not having any car insurance can be devastating, some of which include the following:
Jail time and Fines- Getting caught driving without insurance can lead to jail time and fines associated with this type of offense.
Diminished Independence- If you are dependent on your own transportation and no longer have auto insurance, you, now, will have to find other means of transportation for you and your family if they also depend on you to transport them to activities/jobs/school.
Higher Insurance Rate- Once you have been faced with a canceled auto insurance policy, your driving record is tarnished. Once you secure coverage with another insurer, you are considered a “high-risk” driver and subsequently will be faced with a higher insurance premium.
Repossession- If you can’t afford the higher insurance premium and your car is financed, you may risk losing your car altogether in the form of repossession.
Out of Pocket Expenses- If you choose to operate your car without any insurance and cause an auto accident, YOU will be responsible for any and all out of pocket expenses for injuries and damages that result.
Receiving the news that your car policy is canceled is never good news; however you do have some options. First of all, you need to prioritize finding an insurance carrier that will provide coverage for you BEFORE the specified cancelation date, if your present carrier refuses to reinstate. Having a lapse in your insurance coverage could mean facing even higher insurance premiums and additional fines once you do acquire an auto insurance policy.
Secondly, contacting your local N.C. independent insurance agent to inquire about other possible options for insurance is recommended. *However, if your policy was canceled for a more serious offense, you can probably secure insurance coverage through the N.C. assigned-risk program.
Don’t Drive Without Coverage!
Some risks are NOT worth taking so never drive an automobile without insurance coverage. Keep in mind that your coverage can be terminated by a non-renewal as well as cancelation. While many people may think they are the same, they differ in that a non-renewal is termination of coverage at the end of the policy period while a cancelation is a complete termination of your auto policy, outlined by your insurance carrier, regardless of where it falls within the policy period.
If you have any questions regarding an auto policy cancelation, non-renewal, or associated penalties/fees for driving without insurance or having a lapse in insurance, feel free to contact our office at 866-869-3335 to discuss. You can also visit the website https://www.ncdot.gov.