Gephardt: Do You Still Need To Insure A Car If You’re Not Driving It?

SALT LAKE CITY, Utah – If you have a car you never drive because of the pandemic, you might be thinking about ditching the auto insurance policy to save money. Turns out, even if your car is always idle – you are likely going to need at least some level of insurance.

“You don’t want to cancel because insurance companies frown upon that,” said Michelle Megna, editorial director for CarInsurance.com.

Beyond that frown, when you restart your car’s insurance after going without for a while; your premium goes up because you’re now considered high risk after a lapse of coverage.

“You get basically put in the same bucket as you will as people who have an interruption in coverage because they have neglected to pay their bill or they are a high-risk driver and so their coverage got canceled,” Megna explained.

Canceling coverage on an unused car can also interfere with the discounts you’ve received from your insurer.

“If you have a multi-car discount and you take one car off the road, you might lose that,” she said. “If you have been building up time towards a safe driver discount — it depends on the carrier — you are going to have to start all over again.”

Another con against canceling a policy for an undriven car is the state of Utah requires your car to be insured while it’s registered: even if it’s collecting dust. The DMV here does monitor insurance coverage on registered cars, so a canceled policy could lead to fines, even a suspended license.

A third reason: If you’re making payments on your car, your lender won’t let you drop insurance. Even if you own it outright, there are solid reasons to keep comprehensive coverage: remember September’s windstorm?

“Your comprehensive auto insurance will cover your car if a tree limb falls on it,” said Megna. “It covers all falling objects.”

Comprehensive also covers theft, fire and vandalism.

“You wouldn’t want to pull off the coverage because even if you’re not driving it (your car), things can happen to it even just sitting in the driveway,” Megna said.

Instead of canceling, Megna recommended comparison shopping for a new rate or dropping optional stuff, like roadside assistance and rental cars — or consider usage-based insurance based on your actual mileage and driving habits, both good and bad.

“If you are a hard breaker, you drive at night and you take corners very fast, that might not be for you,” Megna added.

Some insurers will allow you to suspend your coverage, as opposed to outright canceling it. It’ll prevent a lapse that would raise your rates, but then again, you will not be covered for any sort of storm damage or theft.