The Risks of Driving Without Auto Insurance

by Ella Pearson | Last Updated: May 10, 2021

Every state has different rules when it comes to what kinds of and how much auto insurance to purchase, but the one thing that they all agree on is that it’s important. Every licensed driver must be covered by insurance in order to drive around on public roads. Driving without insurance comes with serious risk and the chance of being harshly penalized. Here’s an overview of some common penalties that come along with driving without auto insurance.

Common Penalties

Here’s a breakdown of the most common penalties imposed on those driving around without insurance. While penalties differ for each state, below is a list of possible consequences you could face for driving uninsured:

Accidents Involving Uninsured Motorists are Expensive

Driving without insurance doesn’t just put the driver at risk of getting a fine or having their license suspended; it can also result in a very expensive accident. Drivers without insurance that get into an accident are looking at serious costs for damages to their own belongings as well as any damage to the other driver or his/her property. At-fault drivers without insurance are expected to pay all the repair costs for the other driver’s vehicle, as well as any bodily injury or property damage costs outside of the vehicle itself. If you can’t pay, you could face litigation and end up losing your assets–even your home–to cover the cost of damages.

Driving uninsured just isn’t worth the risk, which is why every driver should spend the money needed to obtain proper insurance.

How to Keep a Policy up to Date

Many people lose their auto insurance because they cannot afford to pay the premium, but others simply forget to make a payment or two and then are left without insurance. There are a few ways to avoid this problem:

Cancelling a Policy

It’s vitally important to maintain an auto insurance policy while driving a vehicle on the road, but the moment you decide to part ways with that vehicle and to stop driving it, the policy is no longer necessary. That’s an opportunity to drop coverage and save some money. Return the license plates to the DMV and contact your insurance company to have the policy dropped. The monthly payments will stop, and you’ll save a bundle!

Note: Some states require insurance companies to alert them to the fact that you are no longer covered through their company, and if your insurance company alerts the DMV before you do, you could actually be subject to the same punishment as an uninsured driver!

Remember: You can’t just stop payments to cancel your policy! You must formally notify your insurance policy of your intention to cancel any coverage, then notify your local DMV. Also, note that you can’t simply cancel any and all of your insurance. Some insurance is required by almost every state!