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Will my auto insurance carrier notify the state if I cancel my policy?
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Your state of residence dictates whether you or your insurance company notifies the DMV; car insurance providers do not set this policy. If you're unsure of your state's law regarding car insurance notification, contact either your local DMV or insurance agent. It's a good law to know, especially if you reside in state a requiring immediate notification.
In Nevada, for instance, you'll be asked by the DMV to provide notification. Failing to respond or provide proof of auto insurance will result in the suspension of your registration, followed by a $250 reinstatement fee. In North Carolina, the DMV alerts you by mail with an FS 5-7 Form. You then must respond to this form within 10 days. Failing to respond within this timeframe leads to loss of car registration and a civil penalty fee ranging from $50 to $150.
Insurance lapse penalties also apply to SR 22 coverage, but with greater severity due to the "high risk" status of SR22 holders. In addition to suspended license plates, you may also face higher insurance rates, jail, a suspended license, and additional years being added to your SR22 insurance mandate.
Penalties If You Cancel Insurance for a Registered Vehicle
Whether your lapsed auto insurance coverage was intentional or unintentional has no bearing with law officials. You’ll be penalized either way. The manner of notification and the extent of the penalty vary by state.In Nevada, for instance, you'll be asked by the DMV to provide notification. Failing to respond or provide proof of auto insurance will result in the suspension of your registration, followed by a $250 reinstatement fee. In North Carolina, the DMV alerts you by mail with an FS 5-7 Form. You then must respond to this form within 10 days. Failing to respond within this timeframe leads to loss of car registration and a civil penalty fee ranging from $50 to $150.
Insurance lapse penalties also apply to SR 22 coverage, but with greater severity due to the "high risk" status of SR22 holders. In addition to suspended license plates, you may also face higher insurance rates, jail, a suspended license, and additional years being added to your SR22 insurance mandate.
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