Are you ready to cross car insurance off of your list of things to do today?

 

If you’re worried about a lapse in coverage because of the strain the coronavirus response has put on your finances, you’re not alone. Drivers across the nation are looking for ways to make their payments more affordable.

In this review, we’re going to walk you through all of the potential ways we see coronavirus impacting car insurance, how car insurance companies are finding ways to help, and what you can do to avoid a lapse in coverage while staying home.

We recently reviewed the best auto insurance companies in the nation. If you’re ready to compare auto insurance quotes and find cheaper rates, enter your zip code below or call our team at (855) 518-0148.

 

In This Article:

How Coronavirus Is Affecting Lapses In Coverage

Coronavirus is affecting car insurance in many interesting ways. Millions of Americans have been laid off or furloughed since the beginning of the coronavirus outbreak. The loss of income has many worried about whether or not they’ll be able to make their next insurance payments, rent, and other monthly bills as social distancing rules are projected to continue.

If you find yourself in financial strain due to the coronavirus, our first piece of advice is to not cancel your car insurance policy. A lapse in coverage and the repercussions of driving without the minimum auto liability insurance required by your state might be worse than you think.

Why Is It Important To Avoid A Lapse In Coverage?

There are serious legal repercussions to being caught driving without insurance. Those consequences get more severe if you cause an accident while you’re experiencing a lapse in coverage and can include things like:

  • Community service hours
  • Fines (varies depending on your location)
  • Loss of driver’s license, registration suspension, and revocation of license plates
  • Reinstatement fee to get license, registration, and plates returned
  • Jail time up to three months (varies depending on your location)

Plus, if you cause an accident during a lapse in your car insurance coverage, you’ll be responsible to pay for the cost of medical bills and damages that you cause out of pocket.

Having a lapse in coverage now could make it harder for you to get insured at an affordable price in the future. This is because a lapse in coverage will make you look like a riskier party to insure to your next provider.

What If My Vehicle Needs To Be Inspected?

If you live in New York, the Department of Motor Vehicles vehicle inspection dates have been postponed. Drivers with expired vehicle inspection stickers on their cars won’t get ticketed or stopped for not replacing their stickers while social distancing guidelines are in effect.

Other states, like North Carolina, are keeping mechanics open as necessary businesses, and these repair shops are conducting inspections.

What If My License Needs To Be Renewed?

If your license expires during the coronavirus outbreak, some states (like California and Michigan) are giving extension periods of 60 days so you won’t be ticketed for an expired license if it expired during the outbreak. Online license renewal services are offered in many states, including:

  • Idaho
  • North Carolina
  • West Virginia
  • New Mexico
  • Massachusetts

How Providers Could Help You Avoid A Lapse In Coverage

Car insurance providers don’t want customers to have a lapse in coverage. Many are crafting payment plans for customers and exclusive deals for healthcare workers to help people make their car insurance payments more affordable.

U.S. car insurance companies are trying to help customers keep up with their payments. Here’s a list of the auto insurance providers that are offering certain payment plans and deals during the coronavirus outbreak. If you don’t see your provider on the list, you’re encouraged to call your provider, explain your situation, and ask about your options.

Allstate

The “Shelter In Place” package gives customers a 15-percent refund during the coronavirus outbreak. The money will be automatically deposited with no action required on your part.

Auto-Owners Insurance

If you’re a customer, you can call the company to discuss changing payment due dates, changing payment plans, or getting an extension on your due date.

Esurance

Customers will receive a 15-percent cash back refund in April and May of 2020.

Farmers

Premiums in April 2020 will be reduced by 25 percent. The company will apply this automatically as a credit on your next bill. If you paid your premium in full already, you’ll get a refund.

Geico

Auto and motorcycle policyholders will receive a 15-percent credit in April 2020. Plus, policy cancellations and expirations due to nonpayment will be put on hold through at least through April 30, 2020.

Liberty Mutual

With the Personal Auto Customer Relief Refund, customers will get a 15-percent refund in April and May. This will happen automatically by way of online refund or check.

Nationwide

Nationwide announced that all current customers will get a one-time $50 refund on their premium.

Progressive

At the end of April and May, all active policies will receive a 20-percent credit.

State Farm

The Good Neighbor Relief Program gives customers payment options. On average, customers see a 25-percent credit.

Travelers

Customers are encouraged to call their local Travelers agent if they are having difficulty making car insurance payments due to COVID-19.

USAA

Every member with an insurance policy that was in effect as of March 31, 2020 will receive a 20-percent premium credit in April and May.

 
 

How Your State Could Help You Avoid A Lapse In Coverage

If you live in California, you’re in luck. California recently passed a piece of legislature stating that insurance providers have to offer a 60-day grace period for all insurance policies: home, auto, life, and others. So drivers are less likely to have a lapse in coverage.

Plus, California and New York health insurers have waived the cost-sharing charges for COVID-19 testing. This means people getting COVID-19 testing in these states won’t have to pay out of pocket for deductibles, coinsurance, copayments, or similar charges.

Making Your Car Payments

Although car payments are not related to your insurance payments, if you recently financed a new car, you might be worried about how to meet your first few car payments. Here are some of your options if you’re struggling financially from the coronavirus outbreak:

Credit arms of Ford, Nissan, General Motors, and Toyota

Owners of new or financed cars have a 90- to 120-day period to make their first payments to these companies.

FordCreditSupport.com

Ford Credit launched a website and hotline for customers who wish to discuss their payment options.

General Motors

New car buyers with great credit get zero percent financing for up to seven years. Plus, OnStar crisis assistance is free during this time.

Hyundai and Genesis

Hyundai’s job-loss protection program for owners and lessees of new vehicles is being relaunched. If a customer lost their job due to the coronavirus outbreak, up to six months of payments are covered.

AllyBank

AllyBank is offering payment deferrals up to 120 days for new customers. There will be interest on the balance, but late fees will be waived.

Fifth Third Bank

Fifth Third Bank is offering payment deferrals up to 90 days, and any new repossessions will be suspended for 60 days.

 
 

Keep Your Car Insurance While Social Distancing

Check out some ways that following social distancing guidelines could help you avoid a lapse in coverage and even save money on your car insurance:

Lower Rates

Car insurance providers take into consideration the number and types of accidents that are most common where you live to determine how risky you are to insure. Typically high-risk auto insurance rates are higher than rates for low-risk drivers.

Staying home due to the coronavirus outbreak means less cars on the road, which could drive the number of accidents down in your area and qualify you for lower rates on your car insurance. The more affordable your car insurance rates are, the less likely you are to experience a lapse in coverage due to nonpayment.

Plans are already in motion to make this happen. The Consumer Federation of America (CFA) and the Center for Economic Justice (CEJ) have drafted a letter to insurance commissioners stating that the number of accidents will dramatically decline as drivers are on the road less. In turn, insurers would ideally refund some money on overly expensive premiums for policyholders who are staying home and not driving as much.

Lower Premiums

When a car insurance company calculates the price of your car insurance premiums, the company considers many factors, including your annual mileage. With social distancing making you stay home from school or work, you’re probably driving less miles than you usually do. This could lower your premiums.

Low Annual Mileage Discounts

If you don’t see your premiums go down much, it would be smart to see if your car insurance company offers low annual mileage discounts. Ask your local agent what opportunities are available to you.

Do’s And Don’ts During Social Distancing

Whether you’re having trouble making your car insurance payments and are worried about a lapse in coverage due to the coronavirus quarantine putting a strain on your finances, here are some things to keep in mind while social distancing:

Do practice routine car care while social distancing. 

Car care during the coronavirus outbreak is important to save money on repairs in the future. Here are some things you can do to care for your car while staying home:

  • Change the oil yourself. You can buy oil at most convenience stores and service centers that are staying open.
  • Check the tire pressure. You can find instructions on how to check your car’s tire pressure in the owner’s manual.
  • Inspect your windshield wipers. Typically, wipers last six months before needing to be replaced.
  • Wash your car. This is a good activity to get some fresh air while social distancing and will benefit your car during pollen season, too.

Do choose a higher deductible to save money on your premiums. 

Or at least, consider choosing a higher deductible. This can be a good idea if you’re a relatively safe driver and don’t expect to be involved in an accident or need repairs. A higher deductible usually comes with a lower monthly payment, so this can be a good way to save and avoid a lapse in coverage.

Do reach out to your local agent to ask about discounts.

You could qualify for low annual mileage discounts that could lower your car insurance rates since you’re driving less. This is also a good time to check on general discounts, like those for good students, safe drivers, and vehicle safety features.

Don’t cancel your car insurance policy and risk a lapse in coverage.

Even though cancelling your auto insurance policy could save you money short-term, it’ll be harder for you to find affordable car insurance rates long-term.

Don’t let your car sit idly for too long.

Turn on the engine, even if you keep it in the driveway. If you forget about your car while staying at home, you could be looking at repair bills when this is all over.

Don’t hide your financial concern from your car insurance agency.

As we discussed, many providers are willing to work with customers who are worried about a lapse in coverage due to the economic effects of the COVID-19 outbreak. Sharing your struggles with the right people at your insurance agency or credit union might be one of the surest ways to help you avoid a lapse in coverage. Many agents are eager to offer advice and help out customers.

Our Recommendations For Car Insurance

While it’s important not to cancel your car insurance during this time to avoid a lapse in coverage, it’s always a good idea to compare quotes from major providers available in your area to be sure you’re not missing out on better rates for the same coverage elsewhere.

Enter your zip code below or call (855) 518-0148 to compare car insurance rates with free quotes instantly. Be sure to look out for policies from our top providers USAA and Geico.

 

USAA: Best For Military

Our USAA car insurance review revealed USAA as the best auto insurance for veterans, active military personnel, and their immediate family members.USAA customers get affordable rates and access to a number of discounts tailored for the needs of military motorists. One of these discounts, the military installation discount, gives customers who garage their car on a military base up to 15 percent off of their car insurance rates.

USAA also has add-ons to make a basic car insurance plan more comprehensive with other types of car insurance like:

Geico: Best Overall

Our Geico auto insurance review named Geico the best overall insurance provider. Geico is a well-known household name in car insurance that provides customers with customizable insurance policies and affordable rates.

Geico has many discounts available for safe drivers, government employees, good students, and more. Plus, Geico customers can customize their policies with add-on purchases to basic car insurance policies like mechanical breakdown insurance and rental car reimbursement.

Still stuck deciding between car insurance companies? Our review of Geico vs USAA might be able to help.