If your insurance is cancelled due to non-payment, it's going to cost you to get it back. Typically, you have a month to reinstate the coverage without a lapse, but that means paying to get your account current. If it's past 30 days or you cannot bring your account up-to-date within that month, your delinquency will change your new auto insurance rate. It will be difficult to get cheap car insurance after cancellation for non-payment.
What We'll Cover
- What Happens if Your Auto Insurance Gets Cancelled for Non-Payment?
- Cheapest Car Insurance Companies After Cancellation for Non-Payment
- State Farm
- The General
- American Family
- American National
- Saving Money After Auto Insurance Cancellation for Non-Payment
- Getting the Best Car Insurance Mix for Your Needs
- Companies Will Charge More After a Refused or Voided Policy, But You Can Still Get Cheap Auto Insurance
What Happens if Your Auto Insurance Gets Cancelled for Non-Payment?
If your car insurance is cancelled because of non-payment, you will have a lapse in coverage. This lapse may be subject to penalties in the form of fines or jail time if you drive without insurance. The rules vary from state to state.
Your insurance company may cancel your coverage for reasons other than non-payment. These reasons include:
- Insurance fraud
- License suspension
If you are cancelled for non-payment, the auto insurance company will typically offer a grace period. In the case of fraud or license suspension, it is unlikely that you'll have any option other than moving into the high-risk insurance category.
Cheapest Car Insurance Companies After Cancellation for Non-Payment
Once you have a lapse in your auto insurance policy, you will move into a high-risk category for insurance coverage. The lapse stays on your record and will affect your rates for at least six months. Some insurance companies will no longer offer you coverage while others will charge higher premiums.
So we took a time to list the best options for you when it comes to finding companies that will offer the cheapest car insurance rates after cancellation for non-payment. They are generally ranked in the order of most to least affordable, but they all offer decent coverage when you need cheap insurance after a refused or voided policy.
Rating: 9.8/10 for coverage, convenience, and price
GEICO is possibly the most popular option for high-risk auto insurance because there isn't much that they won't insure, but it comes with a price. If your "high-risk" is because of non-payment and not a license suspension, they often offer competitive pricing. However, GEICO offers the same grace period many other companies offer, so they too charge more if you have had a lapse in coverage.
Rating: 9.7/10 for coverage and price
State Farm is a popular insurance choice for drivers regardless of their auto insurance risk classification, and they do offer policies for people who have had a gap in coverage. They also offer high-risk insurance for people who are new drivers, require an SR-22, or have had multiple claims.
Rating: 9.7/10 for coverage, convenience, and price
Despite its catchy advertising, The General does not always offer the greatest low rates. However, it does rank just below Geico and State Farm. This is a great choice for no-hassle insurance, but you'll probably want to change insurance companies once your risk is considered low again.
Rating: 9.5/10 for coverage, convenience, and price
At Progressive, you'll still be able to get an auto insurance policy if you've had a lapse due to non-payment. However, you won't be able to get the continuous auto insurance discount. This means a higher rate. Rates are dependent on many factors. Your rate will increase by a higher amount the longer your lapse lasts.
Rating: 8.7/10 for coverage and price
American Family Insurance does offer high-risk policies, which is what you will need if you have had a gap in your insurance coverage. They will even offer coverage for people who require an SR-22. Once your policy is in a normal risk category, they'll give you an additional loyalty discount if you continue to get auto insurance through them.
Rating: 8.5/10 for coverage and price
Allstate understands that you may not want full insurance coverage for many reasons. For instance, maybe you are storing your vehicle. However, it also notes that not having insurance during this time could put you in a high-risk category, in which you will be charged a higher premium. Allstate will still insure you, but they offer many options to help you to avoid these gaps.
Rating: 8.5/10 for coverage and price
There is a "Consistent Coverage" discount through American National that you lose if you don't have auto insurance. Of course, the type of car you drive and your driving record are going to have more of an impact on your premium.
Rating: 8.2/10 for coverage, convenience, and price
Amica is not on the cheapest side of the scale when it comes to getting high-risk auto insurance, but it does offer excellent coverage. This might come at an affordable price if your lapse in coverage is your only negative risk factor, which is what landed this company on the list.
Rating: 7.5/10 for coverage and price
Farmers Insurance does not rank well in the price for auto insurance, and that doesn't change much for high-risk insurance. However, Farmers offers a lot of insurance options, so you are more likely to be able to bundle some coverage for an additional discount.
Rating: 8.5/10 when eligible for coverage, convenience, and price
You are eligible for USAA insurance if you are an active military member or a military veteran. In such a case, you can get affordable insurance despite your lapse in insurance coverage. The only reason this insurance company is ranked at the bottom of our list is because it has limited eligibility and is not available to people who aren't affiliated with the military.
Saving Money After Auto Insurance Cancellation for Non-Payment
It sometimes feels unfair to be monetarily penalized for a lapse in insurance coverage, especially if you didn't pay your premium because you couldn't afford it. Insurance rates are based on statistical analyses that have determined that cancellation for non-payment makes you a greater financial risk. Whether that is true for your specific circumstances doesn't matter because the insurance company can only judge their risk by these statistics. That is why you have to find other ways to save money on your insurance.
A few money-saving tips while searching for cheap car insurance after a refused or voided policy include:
- Purchasing smaller coverage amounts, possibly at state minimum requirements
- Signing up for auto-pay
- Bundling other insurance policies with the same company
- Taking advantage of other policy discounts
- Comparison shopping to find the lowest price/best coverage mix
It is important to understand that the rank-ordered list above may not apply to your unique circumstances. Each company bases its premium pricing on variable factors, all of which can make cheap car insurance after cancellation for non-payment not the best option for you nor your situation. That is why it is best to get multiple quotes before deciding to purchase insurance after your cancellation.
Getting the Best Car Insurance Mix for Your Needs
Finally, it is important that when you shop for auto insurance after your cancellation, you shop for the best insurance for your needs. Consider all of the things you want to protect yourself from in the event of an auto accident. State minimums are often inadequate to cover these scenarios.
When shopping for car insurance, of course, you have to purchase what you can afford. If you can afford more coverage, you might ask yourself the following questions:
- Do you have medical insurance that would adequately protect you financially if you suffered serious injuries in an auto accident?
- Do you have enough coverage to adequately compensate a person for their losses in an auto accident?
- Do you have assets that a person could be awarded in a lawsuit if you didn't carry enough insurance coverage?
- Do you owe money on your vehicle, and does the financial institution require insurance coverage?
- Can you afford to repair your car on your own if it is damaged in an auto accident?
Not only do questions like this matter, but they also can help you to find more ways to save. For instance, you might not need extra towing coverage on your policy. Removing that coverage can result in a small but necessary deduction. Additionally, slightly lowering your coverage may allow you to pay for other insurance perks, such as towing.
The point is that everyone has a different acceptable threshold for loss that they can endure. For some, simply carrying the state minimums is the maximum cost they can endure, and the added financial protection is welcome. For others, they have the means to consider a mix that meets their needs and is an affordable choice for their financial abilities.
Companies Will Charge More After a Refused or Voided Policy, But You Can Still Get Cheap Auto Insurance
In almost every situation, you are going to pay more for insurance coverage after a lapse in coverage. That doesn't mean you can't shop around and find cheap insurance after a refused or voided policy that offers decent coverage.
In addition, if your former insurance company offers a way to reinstate coverage, this is often the best option. So, don't avoid your last insurance company thinking that all is lost. They may offer the best pricing.
Insurance lapses happen for all sorts of reasons, and your agent or online representative only cares about making sure you have insurance coverage again. Don't delay if you've had your policy cancelled. Start shopping for new auto insurance today.