Temporarily Dropping Car Insurance

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dipsylala
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Joined: Tue Feb 11, 2014 9:31 pm

Temporarily Dropping Car Insurance

Post by dipsylala » Wed Jun 11, 2014 4:01 pm

I'm moving to another city in a few days. I just sold my old car. In the new city, I will eventually buy a car, but probably not until two/three months later.

I'm thinking about dropping my car insurance now and resuming it after my car purchase. However, I heard that it is bad to have a gap in car insurance history. Does anyone have any insight?

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mhc
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Re: Temporarily Dropping Car Insurance

Post by mhc » Wed Jun 11, 2014 4:11 pm

If you have some clauses that are grandfathered into your policy, you may lose them.

Talk to your agent to see if he can put your policy on hold.

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Watty
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Re: Temporarily Dropping Car Insurance

Post by Watty » Wed Jun 11, 2014 5:02 pm

Ask your insurance agent. They may have a very low rate for people without a car.

jwa
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Re: Temporarily Dropping Car Insurance

Post by jwa » Wed Jun 11, 2014 5:19 pm

I speak as an agent and as a former underwriter for an insurance company. If you sell your car and move to another city that will not be frowned upon. What is frowned upon is the individual that lets their coverage lapse and allows time to pass before doing anything about it. That shows bad judgement and underwriters don't like to insure people who have bad judgement.

Besides, if you don't own a car, what are you going to insure? If you don't have a car you don't need insurance. After you move and buy a car just advise the agent of your situation and they will advise the insurance company and you will be good to go. If you drive someone else's car, in the meantime, their insurance covers you as long as you are given permission by the owner of that car to drive it; it's their insurance policy that responds. Insurance always follows the car not the driver.

Good luck with the move.

donall
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Re: Temporarily Dropping Car Insurance

Post by donall » Wed Jun 11, 2014 6:22 pm

Car insurance is different from health insurance and you can have gaps. If you don't have a car, you don't need car insurance. if you don't drive your sports car in winter months you can cancel the car insurance and then activate it when you start driving in summer. Of course if a tree falls on the garage over the winter, your house insurance, not car insurance will cover it.

August
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Re: Temporarily Dropping Car Insurance

Post by August » Wed Jun 11, 2014 6:53 pm

Actually homeowner's insurance usually excludes automobiles. In the case of the car in the garage, the homeowner's insurance would probably cover the garage and contents of the garage, but not the car.

jwa
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Re: Temporarily Dropping Car Insurance

Post by jwa » Wed Jun 11, 2014 7:08 pm

August wrote:Actually homeowner's insurance usually excludes automobiles. In the case of the car in the garage, the homeowner's insurance would probably cover the garage and contents of the garage, but not the car.


THIS. Automobiles are excluded from the homeowners policy. If one puts a car on blocks over the winter they can suspend all coverage except comprehensive and be covered for that tree that just fell.

hucards
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Re: Temporarily Dropping Car Insurance

Post by hucards » Wed Jun 11, 2014 8:21 pm

A couple months should be fine. I went 8 years without a car then finally bought one and got dinged when insuring it. I am treated as a new driver and am paying more now (as a 32 year old married man) then when I was a university student. This is in Ontario and we get hammered for insurance though unlike the smart provinces in Canada.

donall
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Re: Temporarily Dropping Car Insurance

Post by donall » Wed Jun 11, 2014 8:25 pm

jwa wrote:
August wrote:Actually homeowner's insurance usually excludes automobiles. In the case of the car in the garage, the homeowner's insurance would probably cover the garage and contents of the garage, but not the car.


THIS. Automobiles are excluded from the homeowners policy. If one puts a car on blocks over the winter they can suspend all coverage except comprehensive and be covered for that tree that just fell.


Wow, had no idea. I'm going to find my homeowner's policy and read it.

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Quasimodo
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Re: Temporarily Dropping Car Insurance

Post by Quasimodo » Wed Jun 11, 2014 8:34 pm

You could notify your auto insurer that you’re selling your car and only need to continue hired and non-owned auto liability to cover you against lawsuits for an accident involving a car you rent or borrow. The premium will be a lot lower than when you insured an owned auto.

John
Many wealthy people are little more than janitors of their possessions. | | Frank Lloyd Wright, architect (1867-1959)

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BolderBoy
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Re: Temporarily Dropping Car Insurance

Post by BolderBoy » Wed Jun 11, 2014 11:06 pm

Watty wrote:Ask your insurance agent. They may have a very low rate for people without a car.

This made me giggle. If I didn't have feet, would a shoe store charge me less for shoes?

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binary13
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Re: Temporarily Dropping Car Insurance

Post by binary13 » Thu Jun 12, 2014 11:35 am

The answer will depend on the insurance company/underwriter. Some companies will give a higher rate for a gap of more than 31 days without liability coverages. Some may be more strict, some may be less. This may only apply for the first term, with a lower rate at renewal.

Also note that liability coverage typically follows the driver, while comp/collision follows the car. So, if you drive a friend's car with your own liability insurance, your insurance will pay for people and vehicles you injure in an accident, while your friend's insurance would cover damage to their own car. If you are uninsured and drive a friend's car, their insurance will generally cover you, but some companies will include specific language to exclude drivers not named on the policy.

If it were me, I would go ahead and get a liability-only policy. Note that in some cases these can be more expensive than if you had a specific vehicle listed on the policy.

bnes
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Re: Temporarily Dropping Car Insurance

Post by bnes » Thu Jun 12, 2014 11:40 am

dipsylala wrote:I'm moving to another city in a few days. I just sold my old car. In the new city, I will eventually buy a car, but probably not until two/three months later. I'm thinking about dropping my car insurance now and resuming it after my car purchase. However, I heard that it is bad to have a gap in car insurance history. Does anyone have any insight?


Insurance companies don't like to see gaps. I got around this once by getting a letter of insurance from a car share company, stating that I was covered during the period in question.

But ultimately this is a better question for your current agent: can they drop you into a holding pattern policy for the interim?

furwut
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Re: Temporarily Dropping Car Insurance

Post by furwut » Thu Jun 12, 2014 11:50 am

If there's any possibility of you driving over the next few months you should retain your own insurance. You need the liability protection.

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