What are the penalties for driving without insurance?
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UPDATED: Mar 13, 2020
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Like groceries, utilities and rent, auto insurance is a necessary expense. While people can find ways to save money on premiums, they must continue paying premiums each month if they wish to own and operate a motor vehicle. This is because car accidents are a common cause for property damage, injuries and death; insurance enables people to be liable for the damage that they cause and provides an opportunity for people to recover the cost of damage or injuries after an accident that’s not their fault.
Because drivers must be held responsible for accidents that they cause, auto insurance laws are strictly enforced. People who drive without insurance are prone to criminal charges, lawsuits, suspended licenses and more. Although it may be tempting to avoid the expense of insurance, the cost of being caught is definitely not worth the risk.
How does the DMV know I have no insurance?
If you don’t have proof of insurance, you cannot register your vehicle. Driving a car without proper registration is a surefire way to gain negative attention from police, who will pull you over; you would then be prone to citations for both lack of insurance and lack of registration.
Some people buy insurance in order to register the vehicle then allow the policy to lapse. When this happens, the insurance company will notify the DMV of the canceled policy. The DMV will then follow up with the driver to inquire if any other insurance was purchased; if the driver is unable to fill out the requisite form, the DMV will suspend their license until insurance is purchased.
Another way that uninsured drivers are discovered is when an accident occurs. If a driver is involved in a collision, they will need to provide proof of insurance to the other party in the accident. Drivers without insurance will be responsible to pay for the damage out of pocket; they may be sent to collections by the other person’s insurance or sued by the other driver.
Penalties for Driving Without Insurance
State laws vary in regards to penalties against uninsured drivers. All states do require insurance, however, and the penalties are usually fairly similar. Depending on the situation, a driver may have all or some of the following occur:
— A Suspended Driver’s License
If you continue to drive on a suspended license, you can expect harsher punishments. Your car may be impounded and you may not be able to recover it until your license is reinstated.
— Suspended Vehicle Registration
As with a driver’s license, if you continue to drive with a suspended registration you will face citations and other punishments.
— Traffic Citations
In addition to the citation you may receive for a suspended license, vehicle registration or any traffic violations that may have led to you being pulled over, you will receive a ticket for failure to carry insurance. Some police officers will forbid you to drive the car home if it is uninsured, so you may have impound fees and a ride in the police car to deal with as well.
— Additional Fines
Beyond paying the ticket and potential impound fees, you must also pay to reinstate your driver’s license and renew the vehcile’s registration. All of these costs come out of your pocket and can add up quickly to far exceed the cost of insurance for a few months.
If you’re unlucky enough to be involved in an accident while the vehicle is uninsured, you are responsible for paying the damage out of pocket. You may be sent to collections right away by the insurance company or you could be sued for damages and injuries. Either way, you will lose a substantial sum of money and your credit will be affected for many years.
Of course, you will also need to pay for any damage that your own vehicle sustains out of pocket whenever an accident occurs. All of these costs can add up quickly, and they will begin to snowball if not addressed immediately. The process of reinstating a license, paying off tickets and getting a car out of impound can be expensive and time-consuming. It’s much easier and more affordable to pay for insurance right away.
Another reason to buy auto insurance is that uninsured drivers actually cause rates to increase. The higher the population of uninsured motorists in a state, the more that state’s insurance will cost. By purchasing auto insurance, you do your part in reducing the cost of insurance overall for all drivers in the state. As more drivers obtain policies, the overall cost of insurance will go down.
In the meantime, you can save money on auto insurance by comparison shopping for the best company online and taking advantage of any discount programs you may be eligible for. By taking the time to choose a company within your budget, you ensure that you have the coverage you need without sacrificing your wallet.