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One of the most frustrating things can be when your insurance company cancels or nonrenews your policy for what feels like no reason at all. While there are a number of regulations in place with states to avoid random cancellations, there are still a variety of reasons for why your insurance company may nonrenew your policy.
What is the difference between a cancellation and nonrenewal?
Nonrenewal: A standard auto insurance policy last from 6 to 12 months, and at the end of that period, your insurance company can decide to your renew your policy and coverage or not. If they choose not to renew your policy, they will provide you with a notification of nonrenewal.
Cancellation: An insurance policy cancellation will usually happen during the initial part of the policy (first 30 to 60 days), but may still happen during the middle of the policy even though it is very rare. In fact, most insurance policies that are cancelled in the initial phase are usually cancelled because the insurance company finds out that your application was incorrect or misrepresented.
Even if you have a bad accident or multiple tickets, your insurance company cannot cancel your auto policy until it comes up for renewal.
Ways to get your car insurance cancelled
- Nonpayment of premium. The most common way to have your policy is cancelled is for nonpayment of premium. Even then, your insurance company must provide you with adequate notice to bring your payments up to date before they can actually cancel the policy.
- Misrepresenting your application. An insurance company can cancel your policy if they find out the information provided on the application was incorrect or untrue. For example, if they find out you have a teen driver in the home that was not stated on your application, they could cancel your policy.
- Fraudulent activity. If the insurance company finds out that you are behaving in fraudulent activity (arranging for your car to be stolen or totaled), then they will cancel your policy and have no obligation to make any claims payments.
Post-cancellation options
Nonpayment of premium. If your policy was cancelled for nonpayment of premium, then most insurance companies will reinstate your policy if you bring the premiums up-to-date.
Note: Most insurance companies will reinstate you back to the date of cancellation; however, some insurance companies will only reinstate your policy on the date payment was made, leaving you with a lapse in insurance coverage. This lapse of coverage can lead to fines and other issues with the DMV. Additionally, they will not pay for any claim that happens during that lapse in coverage.
Having your insurance policy cancelled may make obtaining a new insurance policy much harder to do. In fact, you may have to purchase your insurance from an “assigned-risk” pool where you are assigned an insurance company at much higher premiums.
If you have any questions or concerns about your insurance policy being cancelled or nonrenewed, please feel free to give our office a call.
Did you know that vehicle ownership is actually declining, especially for people who live in urban areas? Many people now prefer to use a car-sharing service or just rent or borrow a car.
The problem that arises is what to do for insurance in these instances where you don’t own a car, but use one a regular basis.
Some insurance companies offer an insurance policy now called a “nonowner” policy. This auto insurance policy will provide liability coverage to protect you and your assets in the event of a claim.
The vehicle doesn’t provide comprehensive or collision coverage because you don’t actually own the vehicle – that coverage would be provided by the owner of the car. One of the great features of this type of policy is that it will cover you for any type of vehicle that drive during the policy period.
Additionally, if you regularly rent a vehicle, this policy will be much cheaper than any policy you purchase directly from rental car company.
When should you consider a nonowner car insurance policy?
You rent cars often. If you rent cars for more than 40 to 50 days a year, then a nonowner policy will be much cheaper for you in the long run. Keep mind this only provides liability coverage, though.
You belong to a car-sharing service. Car-sharing services are becoming much more popular, especially in urban areas. And while the service will usually provide some insurance, you should still consider carrying your own policy in the event you are named individually in the lawsuit for an at-fault accident.
You borrow other people’s cars often. When you borrow a vehicle, the owner’s auto insurance policy does cover you; however, there are instances where the person may have let their insurance lapse or they don’t carry vehicles limits high enough to adequately protect you in the event of a claim. A nonowner insurance policy would eliminate all of those concerns.
You have a problematic driving record. Some states require individuals carry an auto insurance policy even if they don’t own a car, but have had major driving violations like a DUI or DWI..
Usual cost of nonowner car insurance
The cost of nonowner car insurance is much cheaper than a standard auto insurance policy. A nonowner policy assumes that you will be driving much less than someone who owns a vehicle; and, because you don’t have to carry comprehensive and collision coverage, there is a decrease in the premiums there as well.
Most nonowner insurance policies will start at $200 to $250 for a six month period.
If you live in the Denver metro area and are interested in a nonowner insurance quotes, please give our office a call at your earliest convenience.
Let The Holste Agency be your trusted Arvada insurance partner. As an expert within the industry we can help provide you and your family with proper insurance coverage options while still helping you save money on your insurance premiums. With access to over 50 different insurance companies, we can ensure that you have the best protection available to you and your family. Additionally, our friendly staff is here to answer any insurance coverage questions you may have, billing concerns, or help you in the event of claim.
To find out more about our insurance coverage options available to you, please feel free to contact our office.
The Holste Agency is the Arvada insurance agency you can trust!
We care tremendously about protecting you and your family from disaster. Our dedicated staff will ensure your have the right Arvada home and auto insurance coverage at the lowest available premium.
Additionally, we will provide you with the best customer service available. We are happy to answer any insurance questions, concerns, billing issues, or claims.
If you would like to start on your Arvada home and auto insurance quote, please contact our agency by phone or you can receive an instant Arvada insurance quote by clicking here.
If you are looking for the best auto insurance quotes in Arvada, CO, then The Holste Agency is your choice. Our team of expert agents can provide you with multiple money-saving auto insurance quotes from a variety of insurance companies. We will work with you to individually assess your risks and determine which insurance coverages for you and your family will be the best choice.
By partnering with The Holste Agency, you will also ensure all of your insurance questions, concerns and claims issues will be handled by a friendly, knowledgeable staff that is eager to assist you.
Additionally, The Holste Agency will help all Arvada residents find and take advantage of multiple little-known insurance discounts that will ensure you are paying more on your insurance premiums than you have to.
If you have an insurance question or you would like a free quote, please contact our office or visit our ‘Get a Quote‘ page.