If you had a lapse of auto insurance coverage in North Carolina and you never turned in your plates, you may be wondering if there are any consequences.

North Carolina car insurance laws mandate that your insurance company is required to notify the North Carolina Division of Motor Vehicles (NCDMV) if you don’t maintain continuous liability insurance coverage. Once notified, the NCDMV will send an FS 5-7 form, which is a liability insurance termination notice.

You have ten days from the date of the notice to respond to the NCDMV. To prove you have coverage, have your insurance company FAX a copy of your current insurance to 919-733-6969 or electronically send it. You can contact the NCDMV at 919- 715-7000 to confirm the form was received.

Failure to respond within the required amount of time (10 days) can result in the loss of your license plates for at least 30 days and your registration may be suspended.

After the revocation period, you must pay a $50 restoration fee, $50 service fee and appropriate license plate fee. The service fee can be avoided by surrendering your license plate to the DMV during the 10 day period after receiving a notice of revocation.

NC DMV insurance lapse penalty

The more times you let your coverage lapse, the higher the fee. The NCDMV assesses penalties for lapsed coverage based on the number of prior lapses a registered owner has had on their vehicle within three years of the current lapse. The fees, which come with a $50 restoration fee, are below:

  • First  lapse: $50    
  • Second lapse:  $100  
  • Subsequent lapses: $150

To avoid a lapse of coverage when switching car insurance companies, make certain that you purchase your new insurance policy before canceling your old one. Those buying insurance after a lapsed policy pay more when they buy a new policy. A lapse in coverage for a week up to 30 days will hike your car insurance rate by an average of 9%, or about $130, a year. A 60-day lapse gets you a 13% increase, about $190 more a year.

The NCDMV website says that you are allowed to transfer a license plate to another vehicle if the insurance on the new vehicle was current at the same time the insurance was canceled on the old vehicle. In short, there must not be an interruption in coverage.

If you’re shopping for a new policy, our guide to North Carolina car insurance provides expert tips on how much coverage to buy and shows average rates by coverage level, company and ZIP code so you know what you can expect to pay.

Appealing  a revoked license plate in NC

If your license plate was revoked and you want it reinstated because believe your lapse in coverage was not your fault, you can request a hearing. You need to file a liability hearing request form and pay a $60 fee. You can also call the NCDMV at 919-715-7000 for more information about arranging  a hearing if you believe your lapse in coverage was not your fault.