Car Insurance Lapses
Letting your car insurance lapse, even for a short time, can have serious consequences. In Colorado, drivers are legally required to maintain continuous coverage on registered vehicles. If your insurance lapses, you could face fines, license suspension, and higher future premiums.
What Is a Car Insurance Lapse?
A car insurance lapse happens when your policy ends and there’s a gap before a new policy begins or before the old policy is reinstated. Common reasons for lapses include missed payments, switching providers, or mistakenly thinking coverage is no longer needed.
Colorado Requires Continuous Auto Insurance
Under Colorado law, all drivers must carry minimum liability coverage at all times. This includes:
- $25,000 for bodily injury or death to any one person
- $50,000 for bodily injury or death to all persons in any one accident
- $15,000 for property damage in any one accident
Letting your insurance lapse, even if you’re not driving, can still violate the law if the vehicle is registered and not officially stored or decommissioned.
What Happens if Your Insurance Lapses in Colorado?
Failing to maintain insurance can trigger immediate penalties and future financial consequences, such as:
- Fines and fees: The Colorado DMV can impose fines starting at $500 for a first offense.
- License suspension: Your driving privileges may be suspended until proof of insurance is provided and reinstatement fees are paid.
- SR-22 requirement: After a lapse, you may be required to file an SR-22, which proves you’re insured. This adds cost and can last several years.
- Vehicle registration issues: You may be unable to renew your registration if your insurance is not current.
- Towing and impound: In some cases, vehicles found without proof of insurance during traffic stops can be impounded.
Even if you renew your insurance quickly, letting it lapse even briefly can cause complications and make maintaining insurance more difficult.
Higher Premiums After a Lapse
Insurance companies consider lapses a red flag. Even a brief gap in coverage may cause your rates to increase significantly, especially if it occurs multiple times or is associated with a car accident or violation.
Drivers with lapses are often placed in high-risk categories and may have fewer carrier options.
What if You’re in an Accident During a Lapse?
If you’re driving without insurance and get into an accident:
- You may be personally liable for any damage or injury you cause.
- You won’t be able to recover damages under your own policy even if you’re not at fault.
- You could face civil lawsuits or judgments that follow you for years.
Colorado follows a fault-based insurance system, so if you’re found liable without coverage, the financial impact can be severe.
How To Avoid a Lapse in Coverage
Preventing an insurance lapse is fairly straightforward, but it requires some planning. The best ways to avoid losing coverage include:
- Set up auto-pay: Ensure your premium is always paid on time.
- Monitor your renewal dates: Don’t wait until the last minute to renew or switch providers.
- Communicate with your insurer: If you’re having trouble paying, some companies offer short grace periods or payment plans.
- Cancel policies properly: If switching insurers, overlap your policies by a few days to ensure continuous coverage.
Many companies allow customers to request payment arrangements online, and your due date can often be adjusted by contacting the insurance company.
Don’t Risk Driving Uninsured
Driving without insurance in Colorado can cause long-term damage to your finances, driving record, and legal standing. Whether your policy lapsed due to an oversight or financial issue, it’s important to reinstate coverage immediately and understand the consequences of even short gaps.
Stay protected, stay covered, and stay on the road legally. Zaner Law Personal Injury Lawyers is here to help if you need it. Call to schedule a free consultation with a Colorado personal injury lawyer.
We are located in Denver, CO, proudly serving all of Denver County.
Zaner Law Personal Injury Lawyers
1610 Wynkoop Street, Suite 120
Denver, CO 80202
(720) 613 9706
