What are possible outcomes when you get in an accident and there is a lapse in insurance?

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My car insurance lapsed because my insurance company couldn’t prove my address. I didn’t notice the lapse until I got into a car accident. Now they won’t reinstate my insurance because I was in a car accident. What can I do? I verified my address but they still refuse and now my car is totaled and the other car has some damage. I know they are going to try and say I was at fault. My insurance only lapsed for 5 days.”

Asked February 13, 2019

1 Answer

In the state of Virginia, a lapse in vehicle insurance can result in the suspension of vehicle registration. A driver that gets into a traffic accident with an uninsured vehicle may be responsible for paying out of pocket for injuries pertaining to the affected party. This includes any emergency costs such as an ambulance and any surgeries. If the damaged vehicle of the other party can not be saved, then the person responsible or involved in the accident will be held responsible for replacing the vehicle.

If your car insurances lapses, the state holds the right to take away driving privileges. A fine must be paid to restore driving privileges. In the state of Virgina, the registration reinstatement fee is $145 It is possible for the state to know you are driving with an insured vehicle without driving. Driving uninsured is a common and costly problem for the state of Virginia, so many states are requiring insurers to use an electronic reporting system that tells them when insurance has lapsed.

To avoid penalties, you must cancel your registration before the lapse in car insurance. Insurers typically provided a 30-day notice in advance. This method posses the least amount of risk to the driver.

Unfortunately, there is not a grace period for car insurance. If the lapse in car insurance has surpassed 30 days, the car insurance rate will go up significantly, by about more than 10%. After a 60 day lapse, a 13% increase in insurance is applied. These numbers are specific to the state of Virginia. Other states may apply an increase upwards to 50%.

A lapse in insurance can be a stressful situation. It is advised to contact your insurer immediately. This will help mitigate any accruing fees. Be prepared to invest some time and money.

You may also want to reach out to the Virginia Bureau of Insurance who may offer some advice if your insurer is simply trying to get out of paying a claim.

Answered February 15, 2019 by CenterStone

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