Do I Need Insurance If I Don’t Drive My Car?

Having car insurance can feel like an annoying expense, especially if you aren’t driving your car very often. However, maintaining insurance coverage is still important even if your car mostly sits in the driveway or garage. Here’s what you need to know about insuring a car that isn’t being driven regularly.

Why You Still Need Car Insurance

Legally, you are not required to have insurance on a car that is not being driven. However, having no coverage can leave you financially vulnerable if something happens to the vehicle while it’s in storage. Here are some scenarios where lack of insurance could end up costing you big:

• Theft: Your parked car could be stolen, even right out of your own driveway or garage. Without comprehensive coverage, you would get zero compensation for the loss of the vehicle.

• Vandalism: Teenagers or other vandals could smash windows, slash tires, spray paint graffiti, or otherwise damage your stored car. Collision coverage helps pay for damage from vandalism.

• Severe weather: A major hail storm could leave your unused car full of dents. Flood waters from heavy rains could damage the interior and mechanical components. Comprehensive coverage helps pay for damage from weather events.

• Falling objects: A tree branch could break off and smash your windshield. Construction debris could dent your hood. Again, comprehensive insurance can help pay for these types of damage.

• Collisions: Even if you don’t drive the car, it could still be hit by another vehicle. For example, a drunk driver could veer off the road and crash into vehicles parked in driveways. Collision coverage helps pay for damage from collisions.

• Fires: Electrical faults or other issues could cause your stored vehicle to catch fire. Comprehensive coverage helps pay for fire damage.

The bottom line is that a lot can happen to your unused car that would result in expensive repairs or potentially total loss of the vehicle. Maintaining insurance protects you financially in these situations.

Minimum Coverage Requirements

In most states, you need to keep a minimum level of liability insurance on your car to keep the registration active, even if you are not driving the vehicle. This requirement exists so that victims have a source of compensation if the unused car is involved in an at-fault accident that causes property damage or injuries.

The minimum liability coverage amounts vary by state. For example:

• In California, you need:

  • $15,000 bodily injury liability per person

  • $30,000 bodily injury liability per accident

  • $5,000 property damage liability

• In Florida, you need:

  • $10,000 personal injury protection

  • $10,000 property damage liability

• In New York, you need:

  • $25,000 bodily injury liability per person

  • $50,000 bodily injury liability per accident

  • $10,000 property damage liability

• In Texas, you need:

  • $30,000 bodily injury liability per person

  • $60,000 bodily injury liability per accident

  • $25,000 property damage liability

Check your state’s minimum requirements. Dropping below these limits could put your car registration at risk.

How Much Coverage is Enough?

While you need to maintain your state’s minimum liability coverage to keep your registration valid, experts often recommend getting more protection than just the minimums. Here are some factors to consider when deciding how much coverage is right for your stored vehicle:

• The car’s value: If your car is very old and worth less than $1,000, you may decide to just get liability coverage. But for newer cars or classic/collectible vehicles, you’ll want higher coverage limits and comprehensive/collision to protect your asset.

• Your finances: How much could you afford to pay out-of-pocket if the car was totaled or stolen? Pick limits and deductibles you can manage.

• Where it’s stored: If the car is parked on the street, coverage for theft may be more important. If it’s garaged, comprehensive for other damage may be sufficient.

• Multi-policy discounts: You may get a break on your premiums by bundling your unused car with your regular car insurance policy.

• Young drivers: If you have teens or college students still on your policy, it can be riskier to go with state minimum coverage.

Think about your specific situation. While you can usually save money by dropping comprehensive and collision coverage, you don’t want to go too bare bones on liability limits. An accident could exceed the state minimums very quickly.

Ways to Save on Insurance for an Unused Car

Okay, so you need to keep insurance on your stored car. But that doesn’t mean you can’t find some savings:

• Adjust mileage: Let your insurance company know you drive the car less than 3,000-5,000 miles per year to see if you qualify for low mileage discounts.

• Raise the deductible: Going with a $500 or $1,000 deductible instead of $250 or $500 can lower your premiums. Just be sure you could pay the higher amount if needed.

• Drop optional coverages: You can likely do without rental reimbursement, roadside assistance, etc. if the car isn’t being driven.

• Pay in full: Paying the 6 or 12 month premium upfront prevents installment fees.

• Check other carriers: See if competitors offer a better rate, especially if you bundle with homeowners or renters insurance.

• Maintain a good driving record: Avoid accidents, traffic violations, and claims on your other vehicles to keep your overall premium down.

• Ask about discounts: See if you’re eligible for any other policy discounts based on occupation, education, security devices, etc.

What to Know About Canceling Insurance

Many people wonder if they can just cancel their insurance completely if they aren’t driving the car for an extended period of time, like 6 months or a year. Here are a few points about canceling coverage:

• As mentioned, you need to maintain your state’s minimum liability coverage to keep your registration status. So you cannot cancel everything.

• Lenders and leasing companies will also require you to maintain physical damage and liability coverage if the car has an outstanding loan or lease. Refusing to carry the required insurance typically constitutes default.

• When you cancel, you’ll receive a pro-rated refund for any unused premium. But canceling and restarting coverage later often means paying new policy fees and down payments again.

• After canceling, you’ll need to turn in your license plates. You’ll also need to get the car inspected again before registering it in the future.

• Lapse in insurance can count against you when you go to purchase a new policy. Significant gaps may increase your rates.

Unless you plan to sell the car and completely give up ownership, canceling all coverage is usually not the best approach. You’re better off keeping minimum liability and adjusting other coverages to be cost-effective.

Tips for Maintaining an Unused Vehicle

In addition to keeping some insurance coverage active, you’ll also need to properly maintain your stored vehicle to prevent deterioration. Here are some tips:

• Keep the gas tank at least half full to reduce risk of rust in the tank. Use a fuel stabilizer if it will be sitting more than a month.

• Disconnect the battery or use a battery tender/maintainer to preserve battery charge.

• Change the oil and filters before parking it for an extended time. Old oil can become acidic.

• Clean and dry the entire vehicle before storage to prevent mold and mildew.

• Fill up tires to proper PSI rating and add tire foam if storing for over 6 months.

• Park over wooden blocks to raise tires off the concrete, which can cause flat spots.

• Cover the vehicle with a breathable car cover to protect the finish from dust and pests.

• For convertibles, open the top before covering to allow airflow and prevent mold.

• Remove all perishables and valuables from inside the car before storage.

• Consider starting the engine every 4-6 weeks to circulate fluids and lubricate parts.

Proper preparation can keep your stored car in good shape until you are ready to get back on the road. Investing a little time upfront will help prevent expensive mechanical issues down the line.

Alternative Ways to Insure an Unused Vehicle

Aside from a standard auto insurance policy, there are couple other options for covering a stored vehicle:

Agreed value coverage: With an agreed value policy, you and the insurer settle on a dollar value for the car upfront. This can be useful for classic, antique, or collector vehicles that may be difficult to value. Rates are usually higher but you get guaranteed replacement cost within the agreed value if the car is totaled.

On-site storage insurance: Some storage facilities offer special insurance policies that only cover the vehicles while physically on their premises. Coverage applies 24/7 for losses like fire, theft, vandalism, windstorms and more. This can be a cost-effective option if you don’t drive the stored vehicle.

Collector car insurance: Specialty providers like American Collectors, Grundy,