Should You Remove Auto Insurance From A Vehicle You're Storing For The Winter?
If you have a vehicle that you only drive during the summer months, you might be considering removing it from your car insurance for the winter. After all, if you won't be driving the vehicle, there's no reason to have it insured, right? Wrong. Unfortunately, when it comes to auto insurance, it isn't as easy as simply removing the vehicle from your policy for the winter months. There are several other factors that you need to consider before adjusting your auto insurance coverage. Learn whether you can and if you should remove auto insurance from a vehicle that you're storing during the winter months.
Registration
In most states, if you have a vehicle registered, you are required by law to maintain liability coverage on that vehicle. This means that unless you return your license plates to the department of motor vehicles to cancel the registration for the winter, you need to keep the vehicle insured. If you discontinue the vehicle's liability coverage, the insurance company automatically sends notification to the state's motor vehicle department. In most states, when this happens, you're required to provide a new proof of insurance coverage for the vehicle in question in order to avoid any fees or a potential license suspension.
Car Loan
If the car that you are putting in storage for the winter is financed, the bank probably requires you to maintain comprehensive and collision coverage on the vehicle. If you remove the comprehensive and collision coverage, the insurance company automatically sends a letter to your lender notifying them that the coverage has been removed. In most cases, if you don't provide the lender with a new proof of insurance coverage, the lender can add additional fees to your loan.
Weighing Your Options
Some auto insurance companies will allow a stored vehicle to have a comprehensive-only policy. This way, the car is covered in the event of things such as fire, theft, or vandalism. If you're putting your car into storage, you can cancel the vehicle's registration and lower your policy limits to comprehensive-only on the vehicle that you're storing, as long as your insurance company -- and lender, if applicable -- allow it. However, before you make any changes, you should make sure you're actually saving money. Because you'll need to pay for a new vehicle registration once you're ready to drive your car again, you might not save money in the long run by changing your insurance coverage. Instead, ask your insurance company if they provide any type of discount for vehicles that are in storage for the winter. At the very least, the insurance company might be able to save you a few bucks by altering the vehicle's usage amount.
While you might think that removing your auto insurance coverage from a vehicle that you're storing for the winter should save you money, it probably won't. It's important to contact your lender, auto insurance company, and state's department of motor vehicles to weigh all of your options before you make any changes to your policy.
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