I am thinking about cancelling my car insurance. Will there be any hidden costs down the road?

I own my car outright and just moved to a large city. Public transportation and access to a roommate’s car makes transportation easy. I am thinking about storing my car at my parents house and cancelling my car insurance. The car will not be driven unless I reactivate my insurance.

Are there any pitfalls involved in this I should be aware of?
Will there be any reactivation fees or higher insurance fees in the future?

6 thoughts on “I am thinking about cancelling my car insurance. Will there be any hidden costs down the road?

  1. duffbeer703

    If you are driving a roommate’s car, you still need liability coverage. If you injure someone, you are personally liable regardless of the car’s ownership.

    Talk to your insurance agent, they can help walk you through the options in your state. You need to be meticulous about following the rules — the DMV looks unkindly upon insurance lapses.

  2. rjzii

    Depending upon the insurance company they might want to charge you a bit extra for not having had coverage in a given amount of time.

    But beyond that, when it comes time to get insurance again there should not be any extra fees. However, if you are canceling the insurance in the middle of the period there might be some sort of fee.

  3. poolie

    If you’re expecting to not use that car for a long time (several months or more), and it does not have enormous sentimental value, you should think about just selling it. Cars depreciate something like 1% per month, and can degrade if they’re not driven reasonably regularly, so I think the break-even is at about 6 months disuse.

  4. Dunk

    If you go a period of time without car insurance, when you want to get it again you are treated as a higher risk insuree. I had that happen too me when I went back to school. I got rid of the car while in school and after finally graduating, getting a job and a new car my insurance rates were quite high despite having a safe driving record. They said it was because I wasn’t insured for a few years. I don’t recall how long it took for me to get reclassified as a safe driver.

  5. MrChrister

    My insurer will let me suspend my insurance and park the car. It costs about $1/month, but I am still covered if it gets stolen from where it sits.

    I guess I can call and change it from suspended to not suspended once a month in their system, but I really only do it a couple of times a year for a second car.

    Call your carrier and see if they have such a solution, perhaps it will be the best of both worlds for you.

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