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QuestionInsurance Question  If I get a notice of non-operation for a financed car do I need auto insurance for that car?

AnswerAuto Insurance Answer

Some states allow for you to file for non-operation status for your vehicle. One such state is California, who defines non-operational to mean that the vehicle will not be driven, towed, stored or parked on public roads or highways for the entire registration period.

Filing a notice of non-operation with a state is normally done to save on registration fees. In CA they allow for a planned non-operation (PNO) fee to be paid instead of the regular registration cost, the non-operational status will remain until you decide to operate the vehicle and pay full registration renewal fees.

Generally, if you have a financed car you need to continually have auto insurance on it. Most finance paperwork includes this in the terms of the loan. So even if you file a notice of non-operation with your state's DMV and are not going to drive the vehicle, you will definitely need to check with your finance company before attempting to take insurance off of it. Even though the vehicle is not going to be on a roadway does not mean that damages could not occur to it and the need for auto insurance will not be there.

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