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Can You Pause a Car Insurance Policy? (2022) - Insurify

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Amy Beardsley

By: Amy Beardsley

Edited by Jackie Cohen

Last Updated June 15, 2022

Why you can trust Insurify

Insurify partners with top insurance companies and is a licensed agent in all 50 states. However, the insurance experts writing our content operate independently of our partners. Check out reviews from over 3,000 satisfied customers, how we make money, our data methodology, and our editorial standards.

Have you thought about pausing your car insurance? If you’re planning a long trip, taking an extended hiatus from driving, or your car is being repaired, you might consider suspending your coverage. Putting it on pause isn’t the same as canceling it. But when can you pause it? And what options do you have if you can’t?

It’s essential to understand the basics of pausing car insurance before you take the leap. If cost is a factor, getting quotes from different car insurance companies can help you lower your premiums. Use Insurify to quickly compare car insurance quotes from the nation’s top insurance companies, all in one place.

Quick Facts

  • Drivers may be able to pause car insurance, but it depends on the state and insurer.
  • Motorists might consider it if they’re traveling abroad or putting a car in storage.
  • Policyholders have other options to lower insurance costs if they can’t pause their coverage.

Pausing Car Insurance

Can I pause my car insurance or temporarily put ut on hold?

There is no legal way to freeze your car insurance policy if you’re still driving it, but you may be able to cancel your coverage indefinitely if you’re away for a long period of time.

You may be able to temporarily suspend or pause your policy if you won’t be driving your vehicle for a while and don’t need coverage. However, this varies by insurer and state. Some states require ongoing coverage, so it depends on where you live.

You can’t typically pause your entire policy. Liability insurance is usually the only part of your policy that can be paused—and only if you have another type of coverage in place, such as comprehensive insurance.

Depending on state law, you may need to file an affidavit of nonuse with your local department of motor vehicles (DMV) if you put your auto insurance on hold. Some insurers will automatically submit this document for you, but others won’t. It’s best to ask your insurer about their procedure before pausing car insurance.

See More: Best Car Insurance Companies

What if you’re financing a car?

If you’re leasing or financing a vehicle, there’s a good chance that car loan terms prevent pausing car insurance. That’s because lienholders and lessors want the car protected from damage whether it’s being driven or not.

Your lender may let you drop liability coverage if you won’t be driving your car for an extended time. However, you may have to keep comprehensive coverage to cover physical damage from trees, storms, vandalism, and other non-collision accidents. This is why comprehensive insurance is often called “storage” or “seasonal” insurance.

Driving a Vehicle after Pausing Insurance

If you don’t have liability coverage, you’ll be uninsured and won’t be able to drive the vehicle legally in most circumstances. It might be tempting, but you must restore coverage before driving the vehicle.

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When to Pause Car Insurance

When you pause car insurance, your insurer stops providing coverage for a specific time. How long the auto policy is suspended depends on why you want to pause coverage. For instance, you might consider putting a hold on your policy if you’re:

  • Putting the car into long-term storage
  • Vacationing or traveling abroad long-term
  • Being deployed overseas
  • Driving a seasonal or vintage car
  • Dealing with a suspended driver’s license
  • Suffering from an illness or injury that prevents you from driving
  • Waiting on car repairs and can’t drive the car until it’s fixed

See More: Car Insurance Quotes

Pros and Cons of Suspending Your Car Insurance

If you don’t have an immediate need for car insurance, you may be considering putting your policy on pause. It seems like a win-win situation—you can save some money on insurance premiums without letting your policy lapse. But it’s not always a good idea. Consider these benefits and downsides:

Pros of Pausing Car Insurance

  • Lower auto insurance premiums

  • Avoid an insurance lapse that can lead to higher premiums in the future

  • Can keep comprehensive coverage to protect from damage

  • May be able to pause it for long periods

Cons of Pausing Car Insurance

  • No protection if you drive without coverage in place

  • Might be against lender or lessor policy

  • Insurance options may not allow it

  • State law might prohibit it

Alternatives to Pausing Car Insurance

You may want to pause your car insurance if you’re going away for a while or don’t plan on driving your car. Unfortunately, it isn’t always an option. While it may not be possible for everyone to simply pause their car insurance coverage, there are many ways that you can keep your rates low and avoid paying for a service that you’re not using.

Lower Your Coverage

Your car insurance premium is the amount you pay for coverage. Think of that as your monthly rent. If you don’t make payments, you won’t have protection. But if you need to lower your rate temporarily, you might lower your coverage instead of pausing your car insurance. For example, you could:

Drop full coverage: Comprehensive and collision coverages help pay to repair or replace your vehicle if it’s damaged in an accident or stolen. But if you drop comprehensive and collision insurance and get into an accident or your car is stolen, you’ll have to pay for the repairs out of pocket.

Lower liability limits: Liability coverage is almost always required by law and covers bodily injury and property damage claims that you cause in an accident. But going too low means that you could pay tens of thousands (or even hundreds of thousands) of dollars out of pocket if someone sues after an at-fault accident.

Keep in mind these two options could lower your premiums, but they can also increase your financial risk. Plus, you may not have the option if your car is financed or leased. If you have a loan or lease, you may need to keep your insurance active until it’s paid off and the lienholder is removed—even if you aren’t driving the car anymore.

Switch to a Usage-Based Policy

One option sometimes used by drivers to lower costs is to switch to a usage-based policy. These policies rely on telematics—devices installed in your car that monitor and report your driving behavior—to determine your rates. If you don’t drive much or at all during your policy period, your bill can go down dramatically.

However, usage-based policies aren’t always cheaper. You could pay significantly more than a standard auto insurance policy if you drive a lot. But it could work out well if you drive very little or won’t be driving for several months.

Ask About Discounts

If pausing your car insurance policy isn’t an option, ask about car insurance discounts to lower your premiums. Most major and regional insurers offer discounts, such as good driver, defensive driving, automatic payments, multi-car, and bundling discounts. But you may have to ask about them because they may not be automatic.

Remove Yourself from the Policy

If you are named as a driver on a policy that is not in your name, the primary named insured can remove you from the coverage, which will likely lower your car insurance rates. However, you may not be able to drive the vehicles covered under that policy after you are removed.

Cancel Your Coverage

You might consider canceling your coverage if you’re getting rid of your car. After all, you’ll no longer have a vehicle to insure. The cancellation process can often be completed online or over the phone. Just ask your insurance company about the process to ensure you do it properly.

Shop for New and Cheaper Car Insurance

Whether you are a new driver or an experienced one, shopping around for car insurance rates can help you save on a new policy. Using an online insurance quote comparison tool can speed up the process and give you several options to compare auto insurance quotes and deductible amounts side by side.

Should You Pause Car Insurance?

When you pause auto coverage, remember that you are still responsible for insuring your car. Your state laws or lender may require you to keep a minimum amount of coverage on the vehicle, even if you aren’t driving it for an extended period of time.

If you think you might want to pause your car insurance, the first step is to reach out to your insurance provider—and your lender if the car is financed or leased. Talk with a representative to determine your options before pausing your auto insurance coverage.

Frequently Asked Questions

  • You may be able to pause your car insurance in some situations. If you’re traveling abroad or have had your driver’s license suspended, contact your insurance agent or auto insurance company to ask about your options. Your state or lender may not allow it, so make sure you get all the facts before pausing coverage.

  • Pausing your car insurance temporarily suspends the policy for a short term. If you suspend liability coverage but keep comprehensive insurance, you may not legally be able to drive the vehicle. But comprehensive coverage can pay for damages from fallen trees, storms, and theft.

  • It depends on the lender. Many lenders have minimum insurance requirements built into the contract terms. Contact your lienholder or lessor to find out what your options are. Even if they allow you to drop liability coverage, they may require you to keep comprehensive coverage.

  • If you can’t pause your car insurance, you have other options. You may lower your coverage, switch to a usage-based policy, take advantage of every available discount, remove yourself from the policy, cancel your coverage, or shop around to find a cheaper policy at a different company.

References

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Amy Beardsley
Amy Beardsley
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Insurance Writer

Amy is a personal finance and technology writer. With a background in the legal field and a bachelor's degree from Ferris State University, she has a talent for transforming complex topics into content that’s easy to understand. Connect with Amy on LinkedIn.

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