UPDATED: Mar 13, 2020
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When you make a car insurance claim, your insurance company will pay a benefit. The benefit is the amount paid out for any specific claim. The benefit period, meanwhile, is the length of time during which you can claim compensation.
If you are outside of the benefit period when you make a claim, then your car insurance company will deny your claim. If you are within the benefit period, then your car insurance company should cover your claim.
Typically, your benefit period is active for as long as your insurance is active. If you bought car insurance from January 1, 2019 to January 1, 2020, then your benefit period lasts for the exact same amount of time (assuming you pay your premiums on-time).
If you are outside of your benefit period and cause an accident, then you may be liable for all expenses out of pocket. You might have to pay for your own car repair costs, for example, as well as any damages you inflicted upon other people or property. If you’re within your benefit period, then your insurance company will cover these costs.
If you have car insurance and you have paid your premiums, then you can assume that you are within your benefit period. If you have not paid your premiums for a few weeks, or if your insurer canceled your policy, then you can assume you are outside of your benefit period.
How to Check your Benefit Period
For the vast majority of insurance policies, the benefit period begins on the day your car insurance becomes active and ends on the date your car insurance expires.
Check your insurance contract to verify your benefit period. Most insurance policies have specific expiry dates listed.
Most car insurance policies will automatically renew once the old policy date expires. In this case, your benefit gets extended to the new expiry date, and your car insurance company will cover any claims up to that date.
Keep in mind that the expiry date can be misleading. Most insurance policies expire at 12:01 am on the expiry date. If you’re switching insurance companies or renewing insurance, then you need your policy to start on that same date to avoid a lapse in coverage. Otherwise, you will be outside of the benefit period for a full day.
If You Are Outside your Benefit Period, Then You Are Uninsured
If you’re driving outside of your benefit period, then you are technically uninsured. Most states require you to have insurance by law. If you do not have insurance, then you are not legally permitted to drive.
If you are pulled over by a police officer, and the police officer checks for insurance, then the police officer will see that your insurance has expired. You may receive a ticket. Or, in certain states, your car might be towed and impounded.
Being outside of your benefit period is a big deal. You’re personally liable for any damages you cause and you could face significant criminal charges.