Can I put my car insurance on hold?
You can suspend your car insurance if you don't plan on driving for a long period of time. Read this guide to avoid penalties for putting your car insurance on hold for the wrong reasons.
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Brandon Frady
Licensed Insurance Agent
Brandon Frady has been a licensed insurance agent and insurance office manager since 2018. He has experience in ventures from retail to finance, working positions from cashier to management, but it wasn’t until Brandon started working in the insurance industry that he truly felt at home in his career. In his day-to-day interactions, he aims to live out his business philosophy in how he treats hi...
Licensed Insurance Agent
UPDATED: Nov 7, 2023
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Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Nov 7, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance company and cannot guarantee quotes from any single company.
Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- If you suspend your cover for the wrong reasons, you could face penalties and fines for failing to maintain liability cover
- Know what suspensions are for, the consequences of wrongly suspending policies at the wrong time, and how to request a suspension
- You do have the legal right to suspend your insurance policy
There may come a time where you will simply have no need for car insurance for a short period of time.
You do have the option to cancel the coverage entirely, but it often makes more sense just to put your coverage on hold until you are in a position where you will return to driving.
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Reasons Why You May Need to Put Your Insurance On Hold
Insurance is designed to protect you, your passengers, your assets, other drivers, and pedestrians when you are operating a vehicle.
However, there may be scenarios where you have no intention of driving your vehicle and ultimately no risk of having a liability loss.
Even if you feel like a suspension is warranted, you should know what types of situations temporary policy suspensions are meant for.
Here are some of the most common reasons why a policyholder will suspend coverage with their carrier when it is allowed in the state:
— You Sell Your Vehicle and Plan to Buy a Replacement
There is a long list of reasons why your car insurance rates can go up.
One of these reasons is when you have coverage lapses. In addition, if you sell the only vehicle that you own, it might look as if the only option is to cancel your coverage which often leads to losing your prior insurance discount.
If you plan on buying a new replacement shortly, however, you can suspend your policy and then call to activate coverage for the new car once you sign your paperwork.
— Your Vehicle Will Be in Storage or Parked
If you are putting your vehicle in storage, it might be a good idea to suspend most coverage but only if the plates are going to be turned in.
Any vehicle that is registered to be driven must have a minimum amount of liability coverage and in some cases, additional coverage options.
Consider keeping your comprehensive coverage so that you still have protection if the vehicle is stolen or vandalized.
If you do not notify the DMV that your vehicle is not operable or will be parked for an extended period, the department will assume your car is being driven.
The DMV will be notified that your liability coverage has been canceled when you request a suspension. This is why you need to surrender your plates first before you suspend your liability coverage.
— You Are in the Military and You Are Being Deployed
When you are preparing for deployment, you have a lot to deal with. Auto insurance is one of the many things to consider.
If no one will have access to your cars, suspending the policy is an option.
When you suspend your car insurance, you will need to be sure your car is in storage and that the department of transportation knows that you have been deployed.
There may be special requirements for your registration depending on the state that you live in, so be sure to look into state laws and limitations.
Once you do this, you may be able to suspend the following coverage types:
- Personal Liability
- Collision
- Uninsured Motorist Protection
- Underinsured Motorist Protection
- Medical Payments
- Personal Injury Protection
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Benefits of Suspending Your Car Insurance Policy
It might seem like canceling your insurance would be best, but in many cases, it is actually in your best interest to suspend your coverage.
You have to consider when putting coverage on hold will benefit you.
Here are some of the advantages if you choose the appropriate time to do a suspension:
- You can save money on coverage options that you do not need because you are not driving
- You can keep coverage to cover claims for losses to your car while in storage
- You can reactivate cover with one quick phone call
- You can keep prior insurance discounts and loyalty credits
Penalties for Suspending Cover on a Registered Car
The penalties for suspending cover on a vehicle that has plates are very similar to the penalties for driving without insurance.
Even though you are not physically driving the car, you are failing to comply with the law by maintaining insurance when the car is registered.
The consequences vary but may include:
- Fines issued by the Department of Motor Vehicle
- Suspension of driving license or driver license
- Reinstatement fees
- SR-22 requirement on any vehicle you own in the future
- Order to impound the vehicle
- Fines and forced-placed insurance when the vehicle is being financed
If you feel like you have a scenario where a suspension of insurance is merited, call your insurer and see what they allow. You may need to request the suspension in writing and give the effective date that you would like the coverage to stop.
Case Studies: Putting Car Insurance on Hold
Case Study 1: Vehicle Replacement
Sarah decides to sell her car and plans to buy a new one in the near future. Instead of canceling her car insurance, she contacts her insurance company to inquire about putting her coverage on hold. They inform her that she can suspend her policy and reactivate coverage for the new car once she completes the purchase.
Case Study 2: Vehicle in Storage
Michael needs to store his vehicle for an extended period. He wants to reduce his insurance costs during this time but still wants protection against theft or vandalism. He contacts his insurance company and learns that he can suspend most coverage while keeping comprehensive insurance intact.
By suspending his liability coverage and keeping comprehensive, Michael ensures his vehicle is protected while it’s in storage.
Case Study 3: Military Deployment
David, who is in the military, is being deployed and won’t have access to his car. He decides to suspend his car insurance policy since no one will be using his vehicle. David notifies his insurance company about his deployment and follows the necessary procedures to suspend his coverage. By doing so, he avoids paying premiums for a vehicle that won’t be driven and complies with state laws and regulations.
If you have already canceled your coverage, you can start comparing car insurance rates by entering your zip code in our FREE tool below!
Frequently Asked Questions
Can I temporarily suspend my car insurance coverage?
No, car insurance policies generally cannot be put on hold or suspended. Insurance coverage is designed to protect you and your vehicle from potential risks and liabilities at all times. If you’re not using your car and wish to save on premiums, you may consider alternatives such as reducing coverage or exploring usage-based insurance options.
Why can’t I put my car insurance on hold?
Car insurance policies are designed to provide continuous coverage to protect you, your vehicle, and others on the road from potential accidents or damages. Even if you’re not using your car, there’s still a risk of theft, vandalism, natural disasters, or other events that could cause damage or financial loss.
What are my options if I won’t be driving my car for an extended period?
If you won’t be driving your car for an extended period, you can explore a few options:
- Reduce coverage: You may be able to adjust your coverage to reflect your reduced usage. For example, you could consider lowering your liability limits or removing optional coverages like collision or comprehensive while keeping the legally required minimum coverage.
- Storage coverage: If you’re storing your vehicle and not using it at all, some insurers offer storage or comprehensive-only coverage options. These policies provide protection against theft, vandalism, or damage while your vehicle is in storage.
- Usage-based insurance: Some insurance companies offer usage-based or pay-per-mile insurance programs. These policies base premiums on the actual miles driven, allowing you to pay less if your car is not in use frequently.
Can I cancel my car insurance temporarily?
While canceling car insurance temporarily may be an option, it’s generally not recommended. If you cancel your policy and then decide to reinstate it, you may have to go through the application process again, and your premium rates could increase. Additionally, if your state requires continuous auto insurance, canceling your policy could result in legal consequences or fines.
What happens if I don’t have car insurance but still own a vehicle?
Driving without car insurance is illegal in most states. If you’re caught driving without insurance, you may face penalties such as fines, license suspension, or even impoundment of your vehicle. Moreover, if you’re involved in an accident without insurance, you may be held personally responsible for all the costs, including medical expenses and property damages.
To avoid legal and financial risks, it’s essential to maintain at least the minimum required car insurance coverage even if you’re not actively driving your vehicle.
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Enter your ZIP code below to view companies that have cheap car insurance rates.
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Brandon Frady
Licensed Insurance Agent
Brandon Frady has been a licensed insurance agent and insurance office manager since 2018. He has experience in ventures from retail to finance, working positions from cashier to management, but it wasn’t until Brandon started working in the insurance industry that he truly felt at home in his career. In his day-to-day interactions, he aims to live out his business philosophy in how he treats hi...
Licensed Insurance Agent
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.