Most states require at least a minimum level of auto insurance coverage so driving without insurance is illegal. The liability portion of a car insurance pays for injuries and damage you cause to others. Car insurance can help protect you from financial devastation if you cause an accident. Even so, the Insurance Information Institute (III) estimates that as of 2019, the last year with available data, more than 12 percent of drivers were uninsured.
The effects of car accidents without insurance depend on the severity of the accident, the state in which you live, and whether or not you caused the accident. Knowing the penalties for an accident without insurance can help you make an informed decision about your own coverage.
Driving without insurance
The severity of car accidents can range from minor to devastating. Most people know that if you are not insured in an accident there is an effect. But even if the other driver caused the collision, driving without insurance can have consequences.
Accidents without insurance
Depending on the facts of the accident you were in, it could be your fault. If the police are called, they will help identify the fault, as will all insurance companies involved. Sometimes the mistake is relatively clear and sometimes things are a little more complicated. Regardless of whether you are at fault or partially at fault in an accident, a lack of insurance can make things difficult.
If you cause an accident and drive without insurance, it can have a number of serious consequences:
- Repair and replacement costs: You are usually responsible for paying for any damage you cause. This means that you will repair or replace damaged vehicles and objects.
- Medical expenses: If the other driver, their passengers, or someone outside your vehicle, such as a pedestrian, was injured in the accident, you will likely be responsible for paying medical expenses. This can include an ambulance ride, emergency care, surgery, physical therapy, and more.
- Legal fees: If you can’t pay for the damage you caused, the other driver may be able to sue you for damages, including the cost of legal fees.
- Suspension or revocation of the license: Most states will likely suspend your driver’s license for driving without insurance. In fact, if you’ve been caught driving without insurance before, your driver’s license can be completely revoked.
- Required forms: Some states may require an SR-22 or FR-44 form to be on file with your DMV before you can restore your license. These forms prove that you are maintaining the required level of self-insurance coverage. At this point, you will need to get auto insurance as these forms are submitted directly by the insurance companies.
- Seize vehicle: The officer who arrives on site can tow your vehicle if you have driven without insurance.
- Fines: You may have to pay a fine if you are caught driving without insurance, which can be steeper depending on the specifics of your accident.
- Time in jail: Generally, a first offense won’t get you jailed, but multiple cases of driving without insurance can result in jail time.
- More expensive insurance: Insurance companies tend to consider drivers who have caused accidents more risky, as well as drivers whose insurance coverage has expired. The two factors combined could mean that you are paying more for your policy than the average driver pays.
Although the other driver may have health insurance or PIP coverage that could cover some of their medical expenses, you will likely still be responsible for paying their bills if you are held responsible for their damage. Every state is different, so speaking to an insurance professional in your state can be a good way to confirm that you understand how these covers work.
Innocent accidents without insurance
Even if you don’t cause an accident – you might be stopped by another driver – a lack of insurance can still cause problems for you.
- Suspension or revocation of the license: Even if you weren’t the guilty driver, you could lose your license. If the local police are called, your state will most likely ask you to provide proof of insurance. If you are unable to do this, your license may be suspended.
- Fines: If your state fines drivers for foregoing coverage, you will likely have to pay the fine even though you did not cause the accident.
- Seize vehicle: Again, a law enforcement officer may decide to seize your vehicle as soon as they discover that you drove without insurance.
- Expenses: Vehicle damage is not always the result of collisions on the road. For example, a branch could fall on your vehicle or your car could be stolen. If you don’t have an insurance policy, you will be responsible for making any necessary repairs or replacement vehicles.
Driving without insurance can create trouble even if you are not the culprit in an accident.
How to Find Cheap Car Insurance
Auto insurance might not be the most exciting purchase, but it is an important part of your financial plan. While choosing insurance can save you money, the outcome of an accident without insurance can have disastrous consequences for your financial health. If budget is your main concern, there are ways to save on your car insurance.
Compare multiple policy citations
Getting quotes from different insurers can potentially help you find the coverage you need at a price that suits your budget. In addition to price, you can also compare each company’s available coverage, discounts, and customer service values.
Ask about discounts
Most companies offer at least some discounts. You may be able to save on your policy by bundling it with your home, condominium or tenant insurance, driving a vehicle with certain security features, or signing up for paperless statements, for example. You might be able to view auto insurance discounts on a company’s website. However, speaking to an agent is often the best way to identify potential savings.
Safe drivers tend to pay less for insurance than drivers with accidents on their records. This is because if one accident happened in the past, insurance companies are more likely to cause another accident in the future. By maintaining a clean record, you can avoid surcharges on your policy.
Increase your deductibles
When you have full coverage, you have two deductibles in your policy: one for full coverage and one for collision. In general, the higher your deductibles, the lower your premium. Your collision deductible tends to have a greater impact on your premium than your comprehensive deductible. A higher deductible means you’ll have to pay more out of pocket when you file a claim for damages for your car. So choose a level that makes sense for your financial situation.
frequently asked Questions
What is the cheapest car insurance?
Prices vary by provider and depend on individual rating factors such as the state you live in, your driving history, the car you drive, and the coverage you choose. The cheapest business for one person may not be the cheapest for another person. However, if you get quotes from multiple companies, you can find a cheaper policy so you can switch your insurance to a cheaper one.
What if another driver hits me and has no insurance?
The outcome of an uninsured motor vehicle claim depends on the specifics of each accident. The driver who met you may offer to pay for your damage out of pocket. If they don’t reimburse you, you can speak to an attorney about legal action. If your policy isn’t insured, your own insurance can help you pay for your injuries and damages.
Is it illegal to drive without insurance?
Yes, it is illegal to drive without insurance in any state that requires minimum coverage. However, some states have “financial responsibility laws” that allow drivers to demonstrate that they are able to handle the financial consequences of a no-fault accident without insurance. Usually this is a bond or self-insurance. In these states, car insurance is only one way to meet legal requirements, and although it is often the easiest and most common way.