What to Do When You’re In an Accident and Your Insurance is Expired

Has your auto insurance expired? A recent survey by the National Association of Insurance Commissioners (NAIC) showed that one in seven U.S. drivers do not have insurance coverage. The NAIC attributes the growing number in uninsured drivers to the recent downturn in the economy. Many drivers are allowing their insurance to lapse and go uninsured.

You may be tempted to do the same, especially if you’ve never experienced any incidents with your car. However, you should take a look at some numbers. Over 10 million auto accidents occur in the U.S. each year. That is an average of 1000 car accidents per hour and 27,000 accidents per day. There is a great chance that something unfortunate can happen to you. Even if you haven’t experienced an accident, that doesn’t mean it’s not going to happen.

What to Do When You're In An Accident and Your Insurance Is Expired

Costs of Not Having Insurance Coverage

It can be tempting to fail to make your payment on your insurance premium. After all, you may consider it a financial burden that you can do without especially if you haven’t been involved in an accident. You may consider it saving money to allow your insurance policy to lapse. However, while you may make small savings in the short term, there are many costs to pay for not having liability car insurance.

Financial burden of the cost of the accident

If you don’t have car insurance, then you should be prepared to pay the hefty cost of an accident in which you are found at fault. Car insurance allows you to pay a manageable amount over time so that you don’t have to bear the burden of paying a hefty amount of money when an accident occurs. Accident costs are unpredictable.

The cost of medical, crash and car repairs can run into hundreds of thousands of dollars. If you’re found at fault, you will be directly responsible for paying for the damages. And if you don’t have the money, your chances of getting sued are high. Adequate insurance ensures you don’t pay for these out of pocket.

Fines and penalties

It is a legal requirement in most states to have insurance. If you let your insurance policy lapse and are involved in a car accident, you’ll also face penalties and fines for driving without auto insurance. Your costs will increase as a result.

What to Do After an Accident

If your insurance policy has expired and you’re involved in an accident, be sure to:

Call the police

You may be tempted to skip this step as your uninsured state will be revealed. Involving the police, however, is vital if you want to ensure that your rights are protected whether you’re responsible for the accident or not.

Write a statement

Be sure to have a written statement of the accident. This ensures that you have evidence of what actually happened in case the other party decides to sue you for damages.

Contact an attorney

Get in touch with an attorney as soon as possible. This ensures that you have covered all legal requirements and have knowledge and experience on your side in case you are sued.

Negotiate with the other party’s insurance providers

Negotiate with the other party’s insurance providers as a “show of good faith.” You may be able to work out a deal in your favor.

Don’t Let Your Insurance Policy Lapse

Ensure timely payments

Include payments in your budget and ensure that they are paid on time. This will keep your policy from expiring.

Keep your information up to date

Keep your contact and personal information up to date with your insurance provider. Check the information when renewing your policy and make updates where necessary.

Insure all vehicles you own

This should apply even for vehicles that you’re not driving. If it runs and has a title, it should be insured.

Driving without insurance is dangerous; don’t allow your insurance policy to lapse. Look for better deals on insurance policies if you find your current policy too expensive to maintain.

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