Stored Vehicles: Do You Need Insurance?

If you're not driving your car for a while, perhaps because you're going on a long vacation or it's a hobby car that's being rebuilt, you might wonder if you need to keep it insured. While you're not legally required to insure a vehicle that's not being driven, it's still a good idea to maintain some level of coverage to protect yourself from unforeseen events like theft, vandalism, or weather damage. This is known as car storage insurance or comprehensive-only coverage. Keeping your vehicle insured while it's in storage will protect you from unexpected expenses and help you avoid a lapse in coverage that could lead to higher rates in the future.

Comprehensive coverage can protect your vehicle from theft, weather events, and more

While it is not legally mandatory to have insurance coverage for a car that is not being driven and is in storage, it is still a good idea to have some form of coverage. Comprehensive coverage can protect your vehicle from theft, weather events, vandalism, fire, and more.

Comprehensive coverage is the only type of car insurance coverage you need if your vehicle is in storage for a long time. It covers any event that can damage your car while it's sitting still, such as theft, vandalism, building collapse, and fire. For example, if your parked vehicle is destroyed in a garage fire or damaged in a storm, you'll only have to pay the deductible amount. Comprehensive coverage also covers damage caused by wind, hail, and hurricanes.

Comprehensive coverage is also useful if you plan to travel abroad or share one vehicle within your household. It can help you reduce nonessential coverage while maintaining compliance with the law. Additionally, you'll likely see your car insurance premiums go down if you purchase a comprehensive-only policy, as you'll be paying for only one coverage.

If you decide to remove certain coverages from your auto policy, consider keeping comprehensive coverage. Speak with your insurance agent to explore your options and determine what coverages you should get for a vehicle you don't plan to use.

You don't need insurance for a stored vehicle, but it's a good idea

Keeping your vehicle insured while in storage is a way to protect yourself financially. Without insurance, you'll be responsible for any expenses resulting from theft, vandalism, or damage caused by accidents or weather-related events. Maintaining comprehensive coverage can give you peace of mind, especially if you're storing an expensive vehicle. Even if the odds of damage are low, you'll be glad for the insurance in the unlikely event of theft, fire, or another unexpected incident.

Comprehensive-only coverage can also help you avoid a lapse in coverage, which could lead to higher insurance rates in the future. Cancelling your insurance altogether could result in your insurance company regarding you as a high-risk driver and placing you in a high-risk category. Consequently, you may face premium increases when you reinstate your policy.

Before making any decisions, it's recommended to speak with your insurance agent to understand your specific situation and options. They can guide you in reducing non-essential coverage while maintaining compliance with the law and your lender's requirements. Additionally, consider the value of your car, the potential risks of storing it, and your risk tolerance when deciding whether to maintain comprehensive coverage.

Cancelling insurance could result in higher rates in the future

While it is not legally required to maintain insurance coverage for a vehicle that is not being driven and is in storage, cancelling your car insurance policy may still impact your rates in the future.

Insurance companies like to see consistent insurance coverage and reward it with lower rates. It is assumed that if you are not insured, you are not driving, and your skills may have become rusty. Inexperienced drivers are more likely to have accidents, and insurers will view you as a high-risk driver, which results in higher premiums.

In addition, by cancelling your policy before the end of the term, you are breaking the contract you agreed to. This is why cancelling your car insurance policy may impact your rates if done frequently.

If you plan to drive again in a short period, it might make more sense to keep your policy. You can call your insurer and explain the situation, and they may be able to offer you a lower rate based on your reduced annual mileage.

Furthermore, it is important to avoid an inadvertent lapse in coverage. Failing to pay your premiums or losing your license could cause insurers to hesitate before offering you coverage.

You may need to submit forms to cancel the car's registration and insurance

Depending on your state's Department of Motor Vehicles, you may need to submit certain forms before you cancel the car's registration and insurance. For instance, in Massachusetts, you can cancel your registration online unless there are two vehicle owners. In this case, the Affidavit for Cancellation of Registration must be completed and signed by both owners. This form can be mailed to the address listed on the form. Once the cancellation is complete, you can download a Registration Cancellation Receipt.

In Georgia, you can voluntarily cancel your vehicle's registration online using DRIVES e-Services or in person at your local County Tag Office. To use DRIVES e-Services, you will need your license plate number or VIN number and your driver's license number or Letter ID. In person, you will need to complete Form MV-18J Application of Voluntary Registration Cancellation and take it to the County Tag Office where you live.

In Queensland, to cancel a registration, you need to complete the registration cancellation form (F3517) and surrender the number plates, unless you are not required to do so. The form needs to be completed and signed by the registered operator or a representative of the organisation listed on the registration.

Comprehensive-only coverage is also known as parked-car insurance

While insurance companies don't offer specific policies for stored vehicles, they do offer comprehensive-only coverage, which can protect your car in storage. Comprehensive-only coverage is also known as parked-car insurance.

Comprehensive insurance covers damage to your vehicle caused by non-collision events outside of your control. This includes theft, vandalism, glass and windshield damage, fire, accidents with animals, weather, or other acts of nature. For example, if a tree falls on your car during a storm and crushes it, comprehensive insurance will cover the cost of the damage. It also covers damage caused by civil disobedience, such as a riot, or natural disasters like floods, hurricanes, tornadoes, and earthquakes.

Comprehensive insurance is typically optional if your car is paid off. However, if you're financing or leasing your car, your lender may require you to carry comprehensive coverage. It's important to note that comprehensive insurance doesn't cover normal wear and tear, such as replacing worn tires or windshield wipers, or any mechanical issues.

While you may not be legally required to have insurance for a stored vehicle, keeping comprehensive coverage can provide financial protection in the event of any damage. It's a good idea to contact your insurance provider to discuss your options and ensure your vehicle is protected while in storage.

Frequently asked questions