You probably know that a lapse in insurance coverage is likely to cause an increase in your future premiums. This is especially true if you don't do anything to mitigate the impact of the lapse. Therefore, the next time you realize you have a lapse in insurance coverage, take these measures to keep your rates reasonable:
Act First and Contact Your Insurer
The first tip is to act as soon as you realize your coverage has lapsed. The longer you stay without coverage, the harsher the effect will be on your rates. In fact, if you are lucky, you may find that you are still within your insurer's grace period, and your rates won't be affected. Most insurance companies have grace periods within which you can pay your premiums, and your coverage won't be considered to have lapsed. It's your insurer's prerogative to set the grace period or whether to have one at all, so ask your agent about it.
Prove Special Circumstances
You will have to shop for new coverage you are not within the grace period. Insurers frown upon coverage lapse because it makes you risky to insure, especially if you chose not to pay your premiums and continued to drive.
Therefore, you can improve your situation by proving that there were special or unavoidable circumstances that led to your lapse in coverage. For example, you can prove that you couldn't pay your premiums because you lost your job and had your car repossessed. If you are in the military, and you were deployed overseas, you can also use this fact to explain your lapse of coverage. Whatever explanation you give, you should be prepared to prove that you were not driving during the lapse in coverage.
Shop for New Coverage
Insurers have different ways of calculating premiums; they also place different weights on the lapse of coverage. Whereas all insurers frown upon lapse of coverage, some deem it a more serious offense than others. Therefore, get quotes from different insurers, and you might just be lucky enough to land a good rate from another insurance company.
Obviously, the best thing to do is to pay your auto insurance rates in time. However, sometimes things happen that are just beyond your control, and you may find yourself without coverage for some time. Hopefully, the above tips will protect you against steep rate hikes; a quick call to your insurance agent won't hurt either. Talk to an insurance company like Manassero Insurance Agency Inc for more information.