A car insurance policy for an idle vehicle is not something you should pay for right now. If you own a car you don’t drive, you might be wondering whether you should cancel your auto policy or temporarily suspend it.
When you have an out-of-use vehicle, you may be able to save money by putting your car insurance on hold. Netflix subscriptions can’t be halted as easily. Additionally, you may have limited options if you have a car loan or are taking a break from driving the vehicle. To remain legally and financially protected, you’ll need to keep the car insured.
There are five main options to consider when it comes to your auto insurance:
- Request a coronavirus-related payment delay or plan.
- Reduce your coverage.
- Suspend your coverage.
- Remove yourself from a policy.
- Cancel your policy.
What happens if you suspend your car insurance?
| Pros | Cons |
You won’t pay for insurance while your car is out of use.While your car isn’t in use, you won’t have to pay for insurance. You likely won’t have a coverage lapse, something that could increase your future rates. | The vehicle won’t be covered if anyone wants to drive it.Anyone who drives the vehicle will not be covered. Fire, animal damage, vandalism, and theft aren’t covered by the vehicle’s insurance.Typically, drivers with car loans are not eligible. |
Choosing to suspend coverage means your policy will be paused, but it will not be canceled, so you won’t have to worry about coverage lapses.
Customers aren’t always allowed to suspend coverage, or they may only be able to do so in certain circumstances. The company might suggest this option if you expect to be out of work for a long time due to Coronavirus. While you’re looking for work, you will be uninsured if you pause your coverage.
Alternate transportation should be available if you choose this option. In order to halt state-mandated auto coverage, you might need to file an “affidavit of non-use” with your state’s motor vehicle department. Your state will receive this document when you decide not to operate your vehicle for a period of time.
If you have a car loan, you probably can’t suspend your policy. You are usually required to maintain theft and vandalism insurance by your lender.
Removing yourself from the policy
| Pros | Cons |
The vehicle will be covered for non driving issues like fire, animal damage, vandalism and theft. The vehicle will still have the insurance needed to drive it legally. You likely won’t have a coverage lapse, something that could increase your future rates. | You’ll have to pay for insurance while you’re away. You’ll have to add yourself back on the policy once you’re home for at least 30 days. |
Perhaps you can temporarily remove yourself from your family’s car insurance policy instead of changing your coverage. If you will be away from home but other family members will be driving, this is an option you may want to look into.
By taking yourself off the policy, you’ll reduce your chances of getting into a crash if you’re a riskier driver. If it won’t save you money, removing yourself isn’t of much use, and staying on the policy might be more convenient. It may not be possible to do this if you stay in the same house as other insured drivers on the policy and don’t intend on moving away.
All drivers listed at the same address are generally required to have policies, unless they are specifically “excluded.”
An excluded driver is not someone who has removed themselves from the policy. It’s still possible to drive the car even if your name isn’t listed on the policy. If you are excluded from driving, you may have to provide proof of other insurance in order to get the privilege of driving.
How do I cancel my insurance policy?
| Pros | Cons |
You won’t pay for insurance while your car is out of use. You can cancel your car insurance regardless of your insurer. | The vehicle won’t be covered if anyone wants to drive it.The vehicle won’t have insurance against non driving problems like fire, animal damage, vandalism or theft.You’ll have a coverage lapse, which could increase your future rates.Drivers with car loans are typically ineligible. |
If you’re ready to drive the car again, you might want to cancel your auto coverage and get a new policy. You won’t be able to cancel your car loan, however, if you have one. There is a good chance that your lender will require at least some vehicle insurance.
If you’re thinking about canceling your license, you should contact your state’s DMV. If your state requires you to drop the required insurance and take the car off the road, you may have to submit an affidavit of non-use.
A lapse in your insurance history is the biggest downside to canceling. Generally, customers with continuous insurance rates get better rates than those with coverage gaps, commonly referred to as “high-risk drivers.”
Each individual requires a different type of insurance. It should be possible to obtain competitive rates in the future if you maintain your coverage.
Frequently Asked Question
How do I cancel my Tesla Insurance policy?
Tesla Insurance can be contacted directly if you want to cancel your policy. The cancellation process can be initiated by contacting their customer service team by phone or email.
Is there a cancellation fee for terminating my Tesla Insurance policy?
There is usually no cancellation fee associated with Tesla Insurance. The best way to determine if any fees apply in your situation is to review your policy documents or contact their customer service department.
Can I cancel my Tesla Insurance policy at any time?
There is no cancellation fee for Tesla Insurance policies. In case of cancellation mid-term, your premium may be adjusted or refunded according to the remaining coverage period.
How long does it take for my Tesla Insurance policy to be canceled?
When a Tesla Insurance policy is canceled, it usually takes effect immediately. You should, however, contact their customer service team to find out the exact timeline.
Will I receive a refund if I cancel my Tesla Insurance policy?
Tesla Insurance may refund the unused portion of your premium if you cancel it before its expiration date. When canceling your policy, Tesla Insurance will determine the amount refunded based on various factors.
What information do I need to provide when canceling my Tesla Insurance policy?
You will probably need to provide details about your policy, personal information, and the reason for cancellation when canceling your Tesla Insurance policy. If they have any questions, be prepared to answer them.
