Gianetta Palmer is a writer for CarInsurance101.com, copywriter, and essayist. Her work has appeared in EverydayHealth.com, Healthline, and The Dyrt Magazine. She is the author of Scrunchie-Fried and writes a lot about car insurance in her spare time.

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Melanie Musson is the fourth generation in her family to work in the insurance industry. She grew up with insurance talk as part of her everyday conversation and has studied to gain an in-depth knowledge of state-specific car insurance laws and dynamics as well as a broad understanding of how insurance fits into every person’s life, from budgets to coverage levels. She also specializes in automa...

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Reviewed by Melanie Musson
Published Insurance Expert

UPDATED: Mar 13, 2020

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Most car insurance policies will automatically renew after the policy period has finished. Depending on how the insured decides to pay the premiums, a single large payment may be due at the time of renewal or another monthly payment may be applied. For people paying monthly, policy renewal often goes by unnoticed. Auto insurance companies do make any necessary changes to the premiums at renewal time, however, so a person may notice that his bill has gone up or down the first time he pays the bill for the new policy.

In some situations, a policy may not renew. If the policy is being paid one term at a time, the next term will not begin until it has been paid for. Additionally, if monthly payments are missed, the policy may be canceled. Car insurance companies may also choose not to renew a policy due to the insured’s level of risk. If this is the case, the insurance company will send a notice of non-renewal to the policyholder.

An insurance company may sometimes cancel a policy prior to the end of the policy term. This may occur if a policyholder commits insurance fraud or if he engages in illegal activities like drunk driving or street racing. In all situations, the insurance company will provide a written notice of cancellation to the insured.

What to do when a car insurance policy is expired?

Once a car insurance company cancels a policy, the insurance provider will notify the DMV that the vehicle no longer has insurance. At this point, the DMV may suspend a driver’s license until the policy is reinstated or a new policy has been purchased. In order to reinstate his license, the driver will need to purchase insurance and fill out an SR-22 form to submit to the DMV. The SR-22 is a proof of insurance form that can be obtained from an insurance agent or from the DMV’s website.

Filling out the SR-22 form will require the driver to present proof of insurance, so he will need to obtain a new insurance policy prior to completing the paperwork. Purchasing a new insurance policy may be more difficult if the previous policy was canceled due to high-risk behaviors or illegal activities, but high-risk insurance companies exist specifically to provide coverage in these cases.

If the policy was canceled due to missed payments, it may be possible to reinstate the original insurance policy by paying off the owed premiums. Before shopping for another company, the driver may wish to contact the first insurance company and see what options there may be for reinstating the policy. Of course, this is not always possible and may not be the most affordable option, so finding a new insurance company could still be the best option.

Bear in mind when shopping for a new car insurance company that your driving history will be available to every insurance company you approach. Whenever a person submits a request for a quote, the company will run a background check that involves contacting the prior insurance company. This means that the new insurer will know why your policy had been canceled or allowed to expire, and this will influence the premiums you pay as well as whether or not a company will offer you coverage.

The Internet has made it easier than ever before to purchase high-risk auto insurance, so even drivers with a history of accidents or policy cancellations can find affordable insurance online. Many high-risk insurance companies focus on direct sales, so you can locate and purchase a policy online without ever needing to leave your home. In most cases, after you’ve requested the initial quote, a representative will call to discuss the specific needs of your policy and provide you with a more accurate personalized quote.

In order to avoid the inconvenience of a suspended license or difficulties finding a new insurance company, it’s always a good idea to pay your premiums regularly and on time. If you do decide to change insurance companies, you can shop at your leisure before canceling your existing policy and moving to a new company. By engaging in safe driving behavior and maintaining a good payment history with your insurance company, you can ensure that you will always be able to maintain insurance coverage and pay an affordable rate as well.