Can You Pause a Car Insurance Policy? (2024)

Pausing your car insurance coverage only makes sense if you’re storing your car for a long time.

Amy Beardsley
Written byAmy Beardsley
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Amy BeardsleyInsurance Writer
  • 3+ years writing about auto, home, and life insurance

  • 7+ years in personal finance and technology

Amy specializes in insurance and technology writing and has a talent for transforming complex topics into easy-to-understand stories.

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Courtney Mikulski
Courtney MikulskiSenior Editor, Auto
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Courtney’s deep personal finance knowledge extends beyond insurance to credit cards, consumer lending, and banking. She thrives on creating actionable content.

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Konstantin Halachev
Data reviewed byKonstantin Halachev
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Konstantin HalachevVice President of Engineering
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  • Ph.D. in Computational Biology

Konstantin has led data teams across multiple industries, including insurance, travel, and biology. He’s led Insurify’s engineering team for more than three years.

Updated October 19, 2023 at 12:00 PM PDT

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You can’t legally freeze your car insurance policy if you’re still driving your car, but you may be able to cancel your coverage indefinitely if you’re not driving your vehicle for a long period of time.

But pausing your car insurance isn’t the same as canceling it. So when can you pause your car insurance? 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, comparing car insurance quotes from different companies can help you lower your premiums.

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.

How to pause car insurance

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 — just liability and collision coverages if you won’t drive your vehicle. And depending on state law, you may need to file an affidavit of non-use with your local department of motor vehicles (DMV) if you put your auto insurance on hold.[1] Some insurers may automatically submit this document for you, but others won’t. It’s best to ask your insurer about its procedures before pausing car insurance.

Best Car Insurance Companies

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 the 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.

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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

Pros and cons of pausing 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
  • 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
  • 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

Cheap Car Insurance

Cheap Car Insurance

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.

Reduce 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. Here are two ways to lower your costs.

  • Drop full coverage. This coverage helps pay to repair or replace your vehicle if it’s damaged in an accident or stolen. But it costs more than liability-only insurance. Dropping it could save you money. But without full-coverage insurance, you’ll have to pay for repairs out of pocket if you get into an accident or your car is stolen.

  • 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. Lowering your amount of coverage should lower your costs. 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 you.

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. You may have to ask about them because they can sometimes not be automatic.

Remove yourself from the policy

If you’re named as a driver on a policy that’s not in your name, the primary named insured can remove you from the coverage, which will likely lower their car insurance rates. However, you may not be able to drive the vehicles covered under that policy after you’re 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 around for cheaper car insurance

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

Pausing car insurance FAQs

Here are the factors that affect car insurance rates, and below are the answers to common questions about pausing car insurance.

  • Can you pause car insurance?

    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.

  • What happens if you pause car insurance?

    Pausing your car insurance 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.

  • Do you get a refund if you cancel auto insurance?

    It depends on whether you paid your premiums up front. If you’re paying insurance on a month-to-month basis, there’s nothing to refund you. However, if you paid for a quarter, six months, or a year up front, then the car insurance company will refund you a prorated amount.[2]

  • Can you suspend insurance on a financed car?

    It depends on the lender. Many lenders have minimum insurance requirements built into their 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.

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Sources

  1. Progressive. "Can You Suspend Car Insurance?." Accessed October 13, 2023
  2. Progressive. "Can You Get a Refund on Car Insurance?." Accessed October 13, 2023
Amy Beardsley
Amy BeardsleyInsurance 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.

Courtney Mikulski
Edited byCourtney MikulskiSenior Editor, Auto
Courtney Mikulski
Courtney MikulskiSenior Editor, Auto
  • 3+ years producing insurance and personal finance content

  • Main architect of the Insurify Quality Score

Courtney’s deep personal finance knowledge extends beyond insurance to credit cards, consumer lending, and banking. She thrives on creating actionable content.

Featured in

media logomedia logo
Konstantin Halachev
Data reviewed byKonstantin HalachevVice President of Engineering
Headshot of Konstantin Halachev, VP of Engineering at Insurify
Konstantin HalachevVice President of Engineering
  • 7+ years experience in data analysis

  • Ph.D. in Computational Biology

Konstantin has led data teams across multiple industries, including insurance, travel, and biology. He’s led Insurify’s engineering team for more than three years.

Compare Car Insurance Quotes Instantly

Secure. Free. Easy-to-use.
Based on 3,806+ reviews
4.8/5
Shopper Approved
ProgressiveLiberty MutualTravelers

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