Life Insurance: Suspended License, What's The Verdict?

Getting life insurance with a suspended license can be challenging, but it is not impossible. While your license suspension may not directly impact your ability to obtain life insurance, it is essential to understand the potential implications. If you are deemed a high-risk driver due to your license suspension, you may face higher insurance premiums or have limited insurance options. Additionally, maintaining car insurance during your license suspension is generally recommended to avoid a lapse in coverage, which can result in increased rates when you reinstate your license.

Getting a restricted or hardship license

A restricted or hardship license allows a motorist with a suspended license to drive to and from specific places. This could include work, school, drug or alcohol treatment programs, and medical appointments. Some states also allow parents with restricted licenses to drive their children to and from school and other necessary appointments.

Restricted licenses come with conditions that specify when and/or where the motorist can drive. Some states limit drivers to certain routes when commuting to and from permitted places. Many states also impose time limitations, for example, allowing driving only during daylight hours or between certain times specified by the court or Department of Motor Vehicles (DMV).

The eligibility requirements for a restricted or hardship license vary by state. Generally, a driver's eligibility depends on the reason for the suspension, the motorist's driving record, and the type of license the driver had prior to the suspension. For example, some states prohibit restricted licenses for drivers who had their licenses suspended for serious driving offenses, such as vehicular homicide, hit-and-run, or reckless driving. Other states permit a restricted license for a first but not a subsequent suspension. Typically, a hardship license will not restore commercial driving privileges.

In some situations, a driver is eligible for a hardship license only after completing a "hard suspension" period, during which they are not allowed to drive at all. This period is often around 30 days and is common for DUI-related suspensions and revocations.

The procedures for obtaining a restricted or hardship license vary by state. Most states require drivers to submit an application through the DMV, and it is usually up to the driver to prove eligibility and demonstrate that not having a license would be a substantial hardship. This might involve showing a valid reason, such as work, school, or medical necessity, and convincing the DMV that public transportation is not a viable option.

Some states also require the installation of an ignition interlock device (IID) in the vehicle prior to obtaining a hardship license. There may also be a restricted license fee charged by the state.

Maintaining insurance coverage

• Insurers dislike gaps in coverage: Insurance companies view a lapse in car insurance coverage as a red flag, often associating it with high-risk drivers. Consequently, your insurance rate may increase if you have a gap in coverage.
• Eligibility for a restricted or hardship license: A restricted or hardship license allows you to drive to specific places, such as work, school, or medical appointments. To obtain this type of license, you must apply to your state, and they will decide based on your circumstances. If granted, you will need car insurance to drive legally.
• Insurance is necessary for license reinstatement: Before your license can be reinstated, you may need to provide proof of car insurance, complete a defensive driving course, pay outstanding fines, or meet other requirements.
• Loan or lease agreements: If you have a loan or lease on your vehicle, maintaining insurance is crucial to protecting the lender's investment. Even if you're not driving, your car could be damaged, stolen, or involved in an accident. Without insurance, you will be responsible for all repairs or replacement costs.
• Avoid fines and penalties: In certain states, you may face penalties or fines if your vehicle is uninsured, even if it's not being driven. For example, in Maryland, you can be fined $150 for the first 30 days and $7 per day thereafter if your car has a valid license plate but no insurance.
• Continuous coverage for lower rates: Maintaining continuous coverage can help you obtain lower insurance rates in the future. Allowing your insurance to lapse during a license suspension may result in higher rates when you reinstate your license and obtain new insurance.

While keeping your insurance coverage during a license suspension is important, it's also essential to be mindful of any changes to your policy. Carefully review the terms of your insurance policy and understand the state and lender requirements to ensure you're meeting all necessary obligations.

Applying for an SR-22 or FR-44 form

An SR-22 form is a certificate of financial responsibility that is filed with your state to prove that you have car insurance that meets the minimum coverages required by law. It is not a type of insurance but rather a document from your state's department of motor vehicles. An SR-22 is typically required if you've been caught driving without insurance or a valid license. Some other reasons you might need to file an SR-22 form include:

• DUI or DWI conviction
• Driving without enough insurance
• Too many at-fault accidents or violations
• Repeat offenses in a short time frame
• Not paying court-ordered child support
• Hardship license

An FR-44 form is similar to an SR-22 but is required only in Florida and Virginia and typically after a DWI or DUI conviction. The FR-44 document is also filed by the driver's insurance company to prove financial responsibility, but the key difference lies in the minimum liability coverage amounts. FR-44s typically require higher liability limits than SR-22s, making it a more stringent requirement.

If you are required to obtain an SR-22 or FR-44, you will typically receive a letter from your state's department of motor vehicles. If you already have auto insurance, call your insurer and ask if they will file the form on your behalf. Not all insurance companies offer SR-22 or FR-44 filings, so if your current carrier does not, you'll need to switch to a carrier that provides this service.

The cost of obtaining an SR-22 varies depending on the insurance company. Some file the certification for free, while others charge a fee that typically ranges from $15 to $25. The fee may apply at each renewal and may be charged upfront or added to your premium.

Exploring non-standard insurance providers

While it is possible to get car insurance with a suspended license, it can be a challenging process. If your license has been suspended, you will typically be considered a high-risk driver by most insurers, and your options may be limited. However, some non-standard insurance providers specialise in offering coverage to high-risk drivers, and they are worth exploring if you're having difficulty finding insurance. Here are some tips for exploring non-standard insurance providers:

• Apply for a hardship or restricted license: Many insurance companies are reluctant to insure someone with a suspended license. However, they may be more open to providing coverage if you have a hardship or restricted license. The eligibility criteria for these licenses vary by state, so check with your state's department of motor vehicles to see if you can apply.
• Shop around for the best rates: High-risk drivers often face higher premiums, so it's essential to compare quotes from different non-standard insurance providers to find the most affordable option.
• Obtain an SR-22 or FR-44 form: Depending on your state and the reason for your license suspension, you may be required to obtain an SR-22 or FR-44 form. These forms are filed by your insurer to certify that you meet the state's minimum liability insurance requirements. Not all insurance companies offer this service, so you may need to switch to a non-standard provider that caters to high-risk drivers and can file these forms on your behalf.
• Consider a non-owner car insurance policy: If you don't own a car but need insurance to reinstate your license, some non-standard insurance companies offer non-owner car insurance policies, which provide liability coverage when driving a car you don't own.

Some well-known non-standard insurance providers in the US include The General, GEICO, and Bristol West. These companies are known for offering coverage to high-risk drivers and providing SR-22 and FR-44 filing services. Remember to research and compare quotes from multiple providers to find the best option for your specific situation.

Avoiding a lapse in coverage

Even though you can't drive with a suspended license, it's important to maintain insurance on your vehicle to avoid a lapse in coverage. A lapse in insurance coverage can lead to increased insurance costs, fines, and even the suspension of your driver's license and vehicle registration. Here are some steps to help you avoid a lapse in coverage:

• Maintain continuous coverage: Even if your license is suspended, it's advisable to keep your vehicle insured to prevent a lapse in coverage. This can result in higher rates when you reinstate your license and obtain new insurance.
• Contact your insurance company: Reach out to your insurance provider to discuss your options. They may allow you to reinstate your policy, but you may have to pay back premiums and late fees, and possibly face higher rates due to the lapse.
• Obtain new insurance: If your current insurer doesn't allow reinstatement, you'll need to find a new insurance provider. Some companies specialise in insuring high-risk drivers, so explore these options.
• Apply for a hardship or restricted license: In some cases, you may be eligible for a restricted license that allows you to drive to specific locations, such as work or medical appointments. With this type of license, you'll still need car insurance.
• Shop around for the best rates: Compare quotes from multiple insurance providers, as rates can vary significantly. Some companies may offer lower rates for your specific circumstances.
• Consider non-owner car insurance: If you don't own a car but need insurance to reinstate your license, some companies offer non-owner car insurance, which provides liability coverage when driving a car you don't own.
• Maintain a clean driving record: Avoiding tickets and accidents can help you find lower rates, as insurance companies consider driver behaviour when setting premiums.
• Look for discounts: Explore potential discounts offered by insurance providers, such as bundling discounts, good grade discounts, or discounts for completing a defensive driving course.
• Select a higher deductible: Choosing a higher deductible can lower your overall insurance costs, but ensure you can afford the deductible if you need to file a claim.
• Set up automatic payments or reminders: To prevent future lapses, consider setting up automatic payments or reminders to ensure timely renewal of your insurance policy.

Frequently asked questions