If you miss an auto insurance payment, you will not be covered if you get into an accident while it is not paid by the due date. This is commonly called an insurance lapse. During an insurance lapse you are no longer covered by your previous policy and will take full responsibility for any accidents you are involved in.
Does an insurance lapse mean my policy is cancelled?: No, your policy is not cancelled yet. It is required by most states that your insurance provider has to notify you that they are cancelling the policy. Most insurance companies have a grace period of 10-20 days before they will cancel your policy, so it is important to pay your bill as soon as possible.
What happens if my insurance company does cancel my policy?: Firstly, you will not be protected by any type of insurance and will not be able to legally drive. If your insurance company does cancel your policy, it will also be harder to get a new policy and will definitely cost more. If you are leasing a car it also may be repossessed if the leasing company requires that you have auto insurance.
It is very important to pay your auto insurance bill as soon as possible to avoid all of the extra costs you will incur if you let your policy cancel.
Independent insurance brokerage located in Tempe, AZ. We offer auto insurance, homeowners insurance, life insurance, renters insurance, commercial insurance…
Disclaimer: Coverage will vary on state, insurance company, and type of policy.
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Information credit: https://www.progressive.com/answers/car-insurance-lapse/
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