You can lose your auto insurance coverage via two main ways: cancellation and nonrenewal. Below are some of the major differences between them.
Here are the main differences between a nonrenewal and a cancellation of your auto insurance.
The reasons your carrier can cancel your coverage are markedly different from the reasons it might refuse to renew your coverage. Your carrier cannot just decide to cancel your coverage; it must have a good reason for doing so. In fact, even state laws determine acceptable reasons for coverage cancellation.
For example, most states will allow your carrier to cancel your coverage if you fail to pay your premium, if you lie to the insurance company, or if the government has canceled your car registration. As you can see, cancellation typically comes if you have made some mistake in your contract with the insurance company.
When it comes to nonrenewal, however, you don't have to do anything for the insurance company to refuse you coverage. For example, an insurance company might decide to withdraw its operations out of an area, in which case the company won't renew coverage for its existing customers in the region. Other reasons for nonrenewal include moving to a dangerous area, filing too many claims, or drunk driving.
The timing of nonrenewal and cancellation also differ. Cancellation can occur at any time; even in the middle of the policy term. However, nonrenewal only occurs at the end of an existing policy term.
Keeping Your Coverage
Depending on the reasons for non-renewal or cancellation, there are measures you can take to keep your coverage. Below are some of the measures that might help:
Hopefully, you will be able to keep your coverage. However, your carrier is not obligated to continue doing business with you as long as it is not breaking any laws. Fortunately, you can get coverage from another insurance company; talk to a car insurance agent for help doing that.Share
6 February 2020
Ten years ago, I married my best friend in a beautiful, intimate ceremony. My husband and I have been nearly inseparable and we’ve enjoyed this special time in our lives where it has been just the two of us. However, we’re finally ready to have a baby. Because I only work part-time, my husband is the primary financial provider in the family. If something ever happened to him, I wouldn’t be able to instantly support myself and a child. Because my husband worries about an uncertain future, he is considering purchasing a larger life insurance policy. On this blog, I hope you will discover the best types of life insurance policies for young parents to invest in. Enjoy!