Many policyholders opt to pay their car insurance premiums on a monthly basis. However, there are times when you might miss a payment due to forgetfulness or because you cannot afford it. In some cases, missing a car insurance payment might not be a big deal. But in other cases, it could lead to your car insurance policy getting canceled, which can mean facing other repercussions. So, when is a missed payment a minor issue, and when would your car insurance be canceled for non-payment? And, if that happens, what should you do to fix the issue? The short answer is that it depends. Here’s what you should know.

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What happens if I miss a car insurance payment?

Whether you are buying auto insurance for the first time or renewing an existing policy, one of the things you need to think about is being able to make your payments on time. Insurance companies generally set a specific date and time in which they expect to receive your payment, and if you miss it, they could cancel your policy. In some cases, insurance companies have the option to cancel your car insurance policy even if you’re one day late on your payment.

Having a lapse in insurance coverage can cost you in various ways, and it might even be harder to obtain coverage in the future. Here are some of the biggest penalties you might face for missing a car insurance payment:

  • Policy cancellation: As mentioned, your auto insurer will eventually cancel your policy when you have missed a certain number of payments or get too behind.
  • Failure to renew your policy: Not only will the insurance company cancel your policy, but they might not allow you to purchase another policy from them.
  • Increased rates: When you purchase a new policy, your rate might be much higher than it was before due to having a lapse in coverage.
  • Fines from the Department of Motor Vehicles (DMV): Car insurance is required to drive legally in almost every state, so it is possible that you could receive a fine from the DMV for having a lapse in coverage.
  • License/registration suspension: If you get caught driving without valid insurance, it is highly likely that your driver’s license and registration will get suspended until you can show updated proof of coverage.
  • Fines from your lienholder: If your vehicle is financed and your car insurance lapses, your lienholder could charge you penalties for not maintaining auto insurance. Lienholders may even take out insurance on your behalf, called force-placed coverage, and add the premium amount to your loan payment.
  • Impacted credit score: Unpaid bills can end up affecting your credit score.

What happens if your car insurance has been canceled for non-payment?

If you miss a car insurance payment, there may be no need to panic. If it is your first missed payment, your insurance company might let it slide, assuming you are not several weeks overdue. Either way, you should contact your insurer as soon as you realize the due date has passed. Explaining the situation to an agent can sometimes work in your favor and may prevent car insurance cancellation. Make the payment as soon as possible, and if you are not enrolled in autopay, consider signing up to avoid missing a payment in the future.

If your car insurance payment is more than several days late, the situation could be more serious. Again, it is a good idea to contact your insurance provider right away and talk to an agent about your options. If you do not have a grace period for payment on your policy or if you do not pay within the grace period, your insurance company may cancel your policy for non-payment. You should receive a notification of the cancellation, so this should not come as a surprise.

Many car insurance companies offer a grace period, which gives you some extra time after the initial deadline to pay your premium. If you are still within the grace period when you realize your payment is late, you can probably make the payment without facing any significant penalties other than a possible late fee on top of what you already owe.

What is a grace period?
Most auto insurance companies understand that life can be challenging, so many will offer their customers a grace period. Depending on the company, the grace period for payment typically ranges from 10 to 30 days, which can offer you some leeway before cancellation if you are late. If you still have not made the payment after the grace period, your car insurance company may cancel your policy and the cancellation could be retroactive to the date your payment was originally due.

If my car insurance is canceled can I get it back?

When your car insurance gets canceled, you are not allowed to drive legally. You will need to purchase another policy and provide updated information to your state’s DMV to make sure your license and registration are still valid. Otherwise, you could face other penalties. In addition, your insurance company could report the unpaid amount to the credit bureau even after your policy has been canceled.

What to do if you cannot afford your next car insurance payment

If your budget is tight, you might know ahead of time that you will not be able to pay your next month’s car insurance premium. In this case, you should contact your auto insurer as soon as possible.

Every insurance company has different policies, but you might be able to request a different payment deadline, perhaps closer to your payday. It is also possible that your insurance provider would let you defer that month’s payment, which means you would pay it later.

If your insurance policy is set to autopay, you may be able to delay the payment by signing into your online customer portal or the insurance company’s mobile application. If you can let your insurance company know before the due date, they might be able to pause the payment for you.


Bankrate’s take: Many insurance companies will also offer a small discount for drivers who set up autopay. So, in addition to making sure you won’t accidentally miss a payment, your premium may be slightly cheaper.

How to avoid a missed car insurance payment

If you have missed multiple car insurance payments in the past, there are a few things you can do to avoid non-payment issues in the future.

  • Enroll in autopay: As mentioned, the easiest thing is to enroll in automatic payments so the money will automatically be deducted from your bank account or charged to your credit card. But if you get a new bank or credit card number, make sure to update any bills on autopay that the old account number was associated with, including your insurance bill.
  • Set reminders: If you’re worried about what happens if you miss a car insurance payment, the best way to avoid potential penalties is to make sure you are making payments. To do that, set a reminder — perhaps on your phone or your calendar — that will alert you when your bill is due. Consider setting multiple in the days leading up to your payment date so you don’t forget.
  • Shop around for cheaper coverage: If your car insurance is canceled, you might not be able to get it back. But you can use it as an opportunity to shop around for a more affordable — and potentially more flexible — policy. In fact, you can typically cancel and switch plans anytime if you find a better price.
  • Ask about a grace period: Some insurance providers offer grace periods after the payment due date that allow you to make your payment several days later without losing coverage. Contact your insurance company if you miss a payment and ask if they have a grace period or are willing to extend one to you.

Frequently asked questions

    • If your car insurance payment is late, you should pay it as soon as possible. It is also a good idea to contact your insurance company and let them know. If your payment is several weeks late, you will probably have to pay a late fee. Your insurance policy may also be canceled for failure to pay, at which point you might have to purchase a new policy to secure coverage.
    • The grace period for missing an insurance payment varies by insurer. However, the average grace period typically ranges from 10 to 30 days, which can add some flexibility to your payment schedule. If you want to know whether your specific car insurance policy offers a grace period and how long it may be, you can check your policy documents or contact your insurance company or agent to learn more.
    • It depends. Some insurance companies will allow you to reinstate your policy if it gets canceled, while others will not. If your existing provider will not reinstate your auto policy, you will have to apply for coverage through another insurer or have your current insurer issue a new policy, if possible.
    • If you cannot afford a car insurance policy, you may be able to get low-cost coverage through your state. Keep in mind that only a few states offer such programs, though. Those states include California, New Jersey and Hawaii. You can also find affordable car insurance for low-income drivers by shopping around. Bankrate research has found companies like Auto-Owners, USAA and Geico to offer the most affordable insurance plans.