Does My Car Need Insurance If I’m Not Driving It?

Car insurance

As an insurance brokerage, we often get asked the question, “Does my car need insurance if I’m not driving it?”  

The answer to this question is not a straightforward yes or no, as it depends on the circumstances. Let’s explain:

First, it’s important to understand that most states require car owners to have at least minimum liability limits for their vehicles.  

We have a post and video about liability coverage here. Check it out.  

Liability coverage is designed to protect you financially if you are held responsible for causing an accident that results in injury or property damage to others. 

Most states minimum liability limits are $25,000/$50,000/$10,000.  

If you are not driving your car, it may not make sense to continue to pay money each month to insure it. However, you may still be required to do so.  

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If your vehicle is still registered in your name, it may be necessary to maintain liability coverage. 

This is the case for two reasons: 

1. You could still be held liable for any accidents that occur while the car is being driven by someone else. Think about someone in your house who decides to take your car out, even if you’re not driving it and have asked them not to as well.  

2. The state’s MVD requires you to maintain minimum coverage on any vehicle that is registered, regardless of how often you drive or don’t drive.  

However, if you have temporarily taken your car off the road and have no plans to drive it, maybe because it’s broken down and you have no plans to fix it, or because you’re disabled in some way and can’t drive, you have some options.  

In this case, you would need to return your license plates to your local DMV and file a Certificate of Non-Operation to confirm that your car will not be driven. Some states call it a “de-insurance” certificate. This allows you to not have to insure your vehicle while it’s sitting there, not being driven.  

I would only recommend this option if your vehicle will be out of commission for an extended period of time.  

Lastly, it’s worth noting that if you have a car loan or lease, your lender or leasing company will require you to maintain comprehensive and collision coverage, even if you’re not driving the car. Failing to carry the proper insurance will put you in jeopardy of having your car repossessed by the lender.   

There are a lot of factors at play here. So if you’re not sure, don’t chance it. Call and talk to your insurance broker and your states motor vehicle department for clarification on your specific situation. 

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