What happens when your car is destroyed if you still owe a loan and don’t have insurance? If you don’t have any auto insurance, and you were in an accident and totaled your car, you are legally responsible for paying 100% of all expenses related to the accident. but what do these expenses imply?
From repairing or even replacing the vehicles involved to medical bills, let’s look at some of the more prominent costs you’ll likely have to cover.
More: Can I get my car out of impound without insurance?
If your car was totaled without insurance, or if you’re concerned about this happening, you need to find cheap auto insurance coverage. No matter what your situation, the best way to save money is to shop around. enter your zip code above to get multiple quotes for insurers in your area.
what happens if you total a car without insurance?
If you do not have insurance and are involved in an accident in which your car is damaged beyond repair, you will be responsible for all costs related to the accident. take a look at what it could include.
car repairs and replacement
Uninsured drivers without insurance will have no recourse to replace their vehicle if it is too damaged to repair. If your vehicle was financed, you will still be responsible for paying the rest of the loan. In addition, if you have collided with another vehicle, you will have to bear the cost of its repair or replacement. Finally, you will also be liable if you cause damage to someone else’s property, whether it be a fence or a building wall.
More: How many drivers do not have car insurance?
An injured person could sue for medical expenses if you caused the accident. Likewise, failing to purchase auto insurance coverage could lead to a lawsuit that would jeopardize your possessions and resources.
A “financial responsibility” rule is required in every state. For example, if you or someone else driving your car causes an accident, you should be able to cover the costs. A state bond, which can cost more than $50,000, is an impractical approach to meeting financial responsibilities if you can’t afford auto insurance.
On the other hand, auto insurance is the fastest and most cost-effective method of meeting your financial responsibilities.
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You can go to prison for a wrecked car if you don’t have insurance. Most states do not impose prison time on first-time offenders, but a small minority do. For example, it is possible to spend up to a year in prison in Michigan if you drive a vehicle without insurance, allow someone else to drive your car without insurance, or drive an uninsured vehicle through no fault of your own.
The table below shows how many people drive without insurance, according to data compiled by the Insurance Information Institute (III).
there are many drivers who do not have car insurance on the roads. the iii estimates that one in eight drivers in the us. uu. you don’t have insurance.
the repercussions if you wreck a car without insurance
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According to the National Association of Insurance Commissioners, every state in the United States except New Hampshire requires automobile liability insurance. Therefore, you can legally drive without insurance if you can establish that you meet New Hampshire’s alternative financial responsibility criteria. however, according to recent studies, 12.3% of drivers are uninsured despite these laws.
so even if you don’t have an accident or damage your vehicle, driving without insurance can get you in trouble with the law if you get caught. the following are some of the possible results.
heavy fines and license suspension
There is a fine ranging from $100 to $1,500 for driving without insurance, depending on the state. Also, if you don’t have car insurance in certain places, your license could be suspended until you do. the suspension could be more severe in other states. For example, you could lose your license for up to a year in New York if you don’t have auto insurance and are in an accident.
vehicle registration suspension or seizure
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You can lose your vehicle registration if you don’t have car insurance. For example, Massachusetts will stop registering your car until you provide evidence of insurance. You can also be seized if you drive without insurance in California.
higher auto insurance rates
You will have a “coverage gap” if you drive without insurance. Plus, you’ll have to pay more for insurance if you have a gap in your coverage, as insurers consider you to be higher risk.
The table below shows how auto insurance rates increase after a gap in coverage.
As long as you keep in touch with your insurer, it shouldn’t be a problem.
protect yourself and your car with auto insurance
If you own a vehicle but don’t have car insurance, you need to get it fast. You may also want to consider purchasing uninsured motorist coverage to safeguard your investment in the event of a collision with an uninsured car. Compare and get the lowest cost auto insurance companies available from multiple insurance providers to get the most outstanding coverage and prices for your budget.