Car and dollar signDriving without insurance may seem like a money-saving strategy, but you’re taking a big gamble that likely won’t pay off. If you have an accident, you are going to be responsible for paying all medical and property damage costs, and you could lose assets such as your home. Even if you’re lucky enough to avoid that, you will wind up paying nine to 13 percent more on average for a new policy after a lapse in coverage, according to a CarInsurance rate analysis

All states except New Hampshire require you to have a minimum amount of liability insurance, and some also require other types of coverage such as personal injury protection and uninsured/underinsured motorist coverage. Penalties for driving without insurance vary by state; you could get a ticket with a hefty fine if you get caught and lose your license and have your registration canceled.

About one in eight drivers nationwide is uninsured, according to a 2017 report by the Insurance Research Council that shows the estimated percentage of uninsured drivers by state. So chances are good you won’t be the first person who has this problem.

Given the legal and financial risk involved by driving without insurance, you should buy a policy as soon as you can. If all you can afford is the bare minimum of coverage to comply with state minimum liability requirements, that’s better than nothing. The guide to high-risk insurance provides details on how to get coverage.

Once you maintain that coverage for six months, you can shop around. The good news: You’ll find more options and better rates for being insured.

Consequences of driving without car insurance

You do need to be realistic, though. An insurance lapse puts you in a riskier category of customers. Some carriers may deny your application.

That doesn’t mean others will follow suit— in fact some companies specialize in catering to the high-risk market. But don’t be surprised if a carrier refuses to cover you.

“And some carriers might limit the amount of coverage they’ll offer you,” says Jim Kuryak, partner of Niagara National Insurance Group Inc., an independent agency in the Buffalo, N.Y. “You can expect your premiums will be higher.”

With an insurance lapse you won’t be eligible for as many discounts. Companies offer discounts for continuous coverage. The longer you’ve maintained insurance, the better.

What about short lapses?

Kuryak says in many cases an insurance company will reinstate the policy if the lapse is only a few days, especially if you have a good record with that company. If the lapse is longer, then you’ll have to reapply for coverage, and the company might deny the application, forcing you to search elsewhere.

His advice to customers who are uninsured: “Get something in place ASAP or turn the plates in.”

Otherwise fines could accumulate, depending on your state’s regulations. In Kuryak’s state of New York, for instance, the fine for a car insurance lapse is $8 a day for the first 30 days, $10 a day for 31 to 60 days and $12 a day for 61 to 90 days. Your car registration is suspended for the same number of days you keep the plates without having liability coverage. After 90 days your driver’s license is revoked if you haven’t gotten insured and still have the plates. That’s not counting the traffic court fine you’ll face if you get in an accident without insurance.

The cost of a lapsed car insurance policy

How much your insurance goes up after a violation depends on your state insurance laws, your driving record, your age and other factors. Still, it’s easy to get an idea of how much your rate will go up, on average. You’ll see in the table below how much of an increase to expect for a 60-day lapse in your car insurance coverage for a full coverage policy.

State % Increase $ Increase
New Jersey30%$432
New Mexico17%$257
Rhode Island11%$218
West Virginia11%$155
South Carolina9%$122
South Dakota9%$108
New Hampshire5%$62
North Dakota4%$43
North Carolina0%$3
New York0%$0

*Methodology: commissioned Quadrant Information Services to provide a report of average auto insurance rates for a 2017 Honda Accord for 10 ZIP codes in each state. We calculated rates using data from up to six large carriers.

Averages are based on insurance for a single 40-year-old male who commutes 12 miles to work each day, with policy limits of 100/300/100 ($100,000 for injury liability for one person, $300,000 for all injuries and $100,000 for property damage in an accident) and a $500 deductible on collision and comprehensive coverage. This hypothetical driver has a clean record and good credit. The rate includes uninsured motorist coverage. Average rates are for comparative purposes. Your own rate will depend on your personal factors and vehicle.

States with a zero increase are those in which insurance companies refused to provide a quote for a driver with a 60-day insurance lapse.

author image
Michelle Megna
Contributing Researcher

Michelle is a writer, editor and expert on car insurance and personal finance. She's a former editorial director. Prior to joining, she reported and edited articles on technology, lifestyle, education and government for magazines, websites and major newspapers, including the New York Daily News.