A standard auto insurance policy lasts for a year, after which you must either renew your coverage or purchase a policy from another provider. But there are instances in which your policy could possibly be cancelled early, forcing you to take action so you can remain street legal. Most people who drive safe and pay bills on time won’t have to worry about this, but it’s good information to know in case you’re one day faced with a similar incident.
There are two reasons you may find yourself in the position of abruptly switching insurance providers.
At the end of your policy term, the insurance provider may decide to refrain from offering you a renewal. This may happen for this following reasons:
You received too many tickets or other driving infractions
You filed too many claims in a short period of time
The insurer may drop the type of coverage from its offerings
In these cases, you maintain coverage through the end of your policy term. When it’s up, you’ll need to find comparable coverage with a different insurance provider. Any gap in coverage is not only against the law, but reflects poorly on you when your next insurer is calculating your premium.
On rare occasions, your insurance provider may have the right to cancel your coverage in the middle of a policy term. Each state sets rules for the varying circumstances that may allow insurers to cancel your coverage. These circumstances may include:
You fail to pay your premium by the deadline’s grace period
You lie on your application (usually for the purpose of getting a better rate)
You fail to adhere to policy terms and conditions, such as letting an uninsured teen drive
Your risk substantially increases, such as after being convicted of a DUI/DWI
However, if your insurer decides to cancel your coverage, it’s required that you’re first given notice. The period of notice may be anywhere between 10 and 60 days, depending on state law.
Still have questions? Your independent insurance agent can help clear up any confusion.
Our job is to help protect you. Call Remco Insurance at 800-282-2000 for more information on Austin, TX auto insurance.