If you’re traveling for a month or longer, then you may be wondering if you can pause your car insurance to save money. After all, you won’t be driving your vehicle while you’re away – so why would you keep paying for car insurance?
Today, we’re explaining everything you need to know about pausing car insurance while traveling.
You Cannot Typically “Pause” a Car Insurance Policy
Most car insurance companies do not allow you to pause your car insurance. You cannot simply pause it the day you leave and un-pause it the day you return.
If you don’t want to pay for your car insurance while you’re away on a long vacation, then you do have another option: you can simply cancel your auto insurance policy.
However, canceling your car insurance can be a hassle. It can mean a mess of paperwork. It can mean paying higher prices when you buy car insurance again (due to your lapse in coverage).
Canceling your car insurance also leaves your car unprotected while you’re away. If you have full coverage or comprehensive coverage car insurance, then your car insurance policy protects against theft, vandalism, storm damage, and other issues.
Downsides to Temporarily Canceling your Car Insurance Policy
You cannot pause your car insurance while traveling. However, you can cancel your policy and renew your policy when you return from vacation. This may be in your best interest if you’re taking a long trip abroad – say, a 6 month or 12 month trip. However, there are some downsides to temporarily canceling your car insurance policy, including:
Most states require you to have at least basic liability insurance on your vehicle if that vehicle is registered. If you cancel your insurance, then your vehicle registration may become invalid.
If you take your car insurance off your vehicle and your registration becomes invalid, then you will need to return your registration and plates to your state’s DMV. Failure to do so could lead to fines or suspension of your license.
If you cancel your car insurance and renew it six months from now, then you might be forced to pay higher car insurance prices when you renew your policy. Car insurance companies do not like to see lapses in coverage, and you may face higher rates than you did before you canceled your policy.
Some States Allow You to Cancel your Car Insurance Without Losing Registration
One of the downsides of canceling your car insurance is that you will lose registration with your local state DMV.
In some states, however, you can temporarily cancel your car insurance policy and suspend your registration without penalty. Typically, this is only done over a long period of planned non-operation of that vehicle, like a six month period during which you plan to repair your vehicle.
Most Car Insurance Companies Will Raise Rates After a Lapse in Coverage
Car insurance companies don’t want to encourage customers to cancel or “pause” car insurance coverage. That’s why they often punish customers who cancel their coverage.
If you temporarily cancel your coverage and try to renew your car insurance when you return from vacation, then you will likely face higher insurance premiums.
If you’re paying $100 per month for car insurance before you leave on vacation, for example, and you cancel your car insurance for 6 to 12 months, then your car insurance company might increase premiums to $125 per month when you return.
There are even stories of some car insurance companies treating you like a new driver after a long lapse in coverage. If you let your car insurance coverage lapse for 1 or 2 years, for example, then you might pay significantly higher premiums when you renew your policy – at least for the first few months until the car insurance company establishes some insurance history.
Contact your Car Insurance Company and Ask for a Low Mileage Discount
There’s one final thing to note about car insurance and long vacations: some car insurance companies may drop rates slightly if you are not driving your car for a several month period.
Contact your car insurance company and explain that nobody will be driving your car for several months. This could significantly reduce your annual mileage, helping you get a discount on car insurance.
Whether you’re going on vacation for four days or four months, you cannot typically “pause” your car insurance while you’re away.
You are always free to cancel your car insurance. However, this is generally not recommended. It leaves your vehicle without coverage while you’re away. And, when you return from vacation, you may face higher car insurance prices due to your lapse in coverage.
Ultimately, most people will want to maintain car insurance throughout the length of their vacation.