Feb 27, 2021
Getting Insurance After Being Cancelled For Non-payment
People miss payments. Sometimes it just slips our mind, we forget to make a payment until after the due date, there is an issue with our automatic withdrawal, we change bank accounts and forget to notify our insurer, or something happens in our lives that prevents us from making a payment. Insurance is no different, and many people miss payments.
While missing a payment on your phone or cable bill may not have severe repercussions, non-payment of insurance can quickly land you in some hot water with your insurer and your auto policy could get cancelled.
What Is The Impact Of A Non-payment On Your Insurance?
A non-payment is taken very seriously by insurance companies. Even if you don’t mean to miss a payment, it can still have an impact on your insurability now and going forward.
While every company has a different rules in regards to a non-payment, sometimes all it takes is a couple of missed payments to result in cancellation. This can make it more difficult for you to get insured and you may need high-risk auto insurance.
Is A Missed Payment On Insurance A Big Deal?
A missed payment on your insurance should be addressed immediately. Whether your provider contacts you or you notice the missed payment, address the issue immediately. Sometimes amid paying other bills, moving money into your account and other factors, a payment can get missed.
But even one late payment, intentional or not, can cause your insurer raise your rates or choose not to renew you – so yes, a missed insurance payment can be a big deal, especially if you don’t handle the situation in a timely manner.
How Do Missed Payments Or Cancellations Affect My Insurance?
Failure to make a payment or getting cancelled can affect your car insurance in a number of important ways. Here are some reasons to never overlook the importance of paying on time :
- Cancellation : You may get cancelled for non-payment and you could have a lapse in insurance.
- Increased Costs : You could face a premium increase upon policy renewal.
- Insurance History : Non-payment will be noted on your insurance history.
- Additional Fees : Late payment or NSF fees may be charged by the company.
- Payments : You may be required to pay your premiums upfront in 3 or 6 month terms or even a complete full year term.
Don’t forget that even if you have been cancelled and you switch to new insurer, outstanding payments will go into collections and can impact your credit rating. That is another factor that could impact your ability to get insured in the future.
What Can You Do If Your Insurance Is Cancelled For Non-payment?
Getting insurance after cancellation for non-payment can be a challenge. A recent or previous cancellation due to payment issues will create a gap in your coverage and new insurers will want to know why you have a gap.
Don’t lie to them – if you lie to them during the application process, they will have grounds to cancel if they find out.
If you have been canceled, your best option is to work with an advisor to see where you can get insured and find the most affordable price.
How Long Does Being Cancelled For Non-payment Stay On Your Insurance History?
The amount of time a cancelled for non-payment stays on your insurance will depend on a few things :
- Whether or not you are with the same company.
- If you have switched providers.
- The amount of times you have been cancelled for non-payment.
Most insurers go back 3 years to see if you have been cancelled for non-payment. Others go back 6 and some look as far back as 10 years.
It will impact your insurance short-term; and it could impact you long-term, even when you switch to a new provider.
What Some Tips To Help From Getting Cancelled For Non-payment?
Here are some tips to help you avoid payment issues :
- Pay Annually : You can pay your full annual premium up front. Most companies offer discount for doing that and you could save up to 10%.
- Monthly Payment Reminders : Set a reminder in your phone to make your monthly payment.
- Auto Payments : Set up automatic withdrawal or payment from your bank account or credit card.
- Account Balance : Have a buffer in your account to ensure you have enough money for payment.
- Shop : Shop and explore options to lower your costs.
How Can You Get Insurance After Being Cancelled For Non-payment?
Some providers specialize in insurance for drivers who have been cancelled for non-payment. Your costs will likely increase or you may need to pay in installments or upfront. It depends on the provider and your situation.
If you have been cancelled we can help. Speak with one of our advisors. We work with all the companies that specialize this. So we can get you insured at the most affordable price.
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