If your car insurance lapsed and you have an accident, make sure to get the other driver’s contact and insurance information, because their insurance should cover your expenses if they are at fault. On the other hand, if your insurance lapsed and you are partially or entirely at fault in an accident, you will almost always be personally responsible for any damages. If fault is unclear, police officers and insurance companies are more likely to consider an uninsured driver to be to blame.
Regardless of who is at fault, avoid the temptation to lie about the date of an accident. This qualifies as insurance fraud and can result in serious consequences, from difficulty finding insurance in the future to heavy fines and jail time.
If an Insured Driver Is at Fault
If another driver is at fault, you should be able to file a claim with their insurance company to cover damage up to their policy limits. Nonetheless, it will be harder for uninsured drivers to receive payouts, and their options for suing the other driver may be restricted.
For instance, 12 states have “no pay, no play” laws that prevent uninsured drivers from suing for unquantifiable damages like emotional and physical pain. Some of these states also require uninsured drivers to pay large sums out of pocket for repairs before they can sue for further property damage expenses.
If an Uninsured Driver Is at Fault
Drivers with a lapse in coverage who are deemed at-fault will be financially liable for any resulting damage, and could even be sued by the other driver. However, some states require uninsured motorist coverage, which means the other driver could already be covered by their own insurance if an uninsured driver is at-fault.
Similarly, in states with no-fault rules, drivers use their own insurance companies to pay for minor injuries. As a result, if an uninsured driver causes an accident in a no-fault state, the insured driver will be covered by their own insurance up to their policy limits.
One exception is possible, though rare: If you had a lapse in coverage but had already paid for a policy that hadn’t come into effect yet, your insurance company might reimburse you for a claim. However, this is unlikely, and would require you to have a good driving record, a long history with your insurance company, and an accident that took place a few days before your new policy was to begin. The company would be under no legal obligation to reimburse you, though, as you were technically uninsured during the intervening period.
What to Do in the Long Term
Having an accident during a lapse in coverage is a wake-up call that you should get insurance immediately. If your lapse has lasted for days or weeks rather than months, your previous insurer should be able to reinstate your policy quickly and easily, although you may be liable for fees or surcharges. If it’s been longer than a month, shopping around for new quotes is likely your best option. But bear in mind that insurance carriers view a lapse in coverage as a sign of unreliability and risk, so your premium could be higher than before. You can check out WalletHub’s cheap car insurance comparison and discounts guide to find ways to save, though.
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