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Ask the Car Insurance Expert

What happens if I'm late with a car insurance payment?

One late payment isn't terrible, but things will go from bad to worse if you're habitually late.

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If you're usually on time with payments, your car insurance company probably will send you a non-payment notice and then a letter about impending cancellation if you don't pay up. Car insurance companies want to keep their customers, so they usually don't immediately drop someone who's a few days late.

But if you're consistently late with payments, you could get canceled. That's bad news for a couple of reasons. One, you're suddenly uninsured. And two, you might have to pay more to get car insurance reinstated. A history of late payments makes you look risky to insurance companies.

Don't assume there's a 30-day grace period for late payments. That might be the case with some life and health insurance companies, but it usually doesn't work that way for car insurance. State laws set requirements for the number of days you must be given before cancellation has taken effect. Once those days have passed, the auto insurance company can cut off your coverage.

And don't expect a friendly reminder call from your insurance agent. Agents are in the business to sell insurance, and they don't have time to notify delinquent policyholders.

For more see What your insurance agent won't tell you: Your policy is being canceled and The consequences of late car insurance payments.

Last updated: Sep. 14, 2012
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