What can occur if I cancel my liability insurance?
The insurance company must notify the DMV if you cancel your liability insurance. Your insurance company is also required to notify DMV if your insurance coverage is reinstated or you get new insurance coverage. If the insurance company does not file an electronic notice about your new or reinstated liability insurance, the DMV sends you a letter about your insurance. Read the insert mailed with the letter, and follow the instructions in the letter. You are given 10 days from the date of the DMV letter to prove that you have insurance coverage, prove that you sold the vehicle, or show other proof that insurance coverage was not required in NYS. If you do have insurance coverage, also ask your insurance company (do not ask your agent or broker) to file an electronic notice of insurance coverage with the DMV.
If you do not have liability insurance, you must surrender your vehicle plates to the NYSDMV immediately. Make sure you get a receipt. You must respond to the letter you receive from the DMV or surrender your license plates to prevent the suspension of your registration and driver license. If your liability insurance is about to lapse and you do not plan to replace it with other insurance, surrender your vehicle plates to the DMV before your insurance coverage lapses.
What are some of the conditions that can create a lapse in insurance coverage?
Any amount of time that your vehicle is registered but not insured can cause a lapse in your insurance coverage and the suspension of your registration. A lapse in insurance coverage can occur:
* between the date your insurance is cancelled and the effective date that you begin new insurance, and you do not have other acceptable proof;
* between the date your insurance is cancelled and the date you surrender your license plates or the date your registration expires;
* between the date your insurance is cancelled and the effective date of "other proof" (for example, a vehicle registered in another state, or a vehicle repossessed or impounded);
* between the date you register your vehicle and the effective date of your new insurance coverage;
* between the date the insurance is cancelled on a registered vehicle and the date a dealer or the DMV issues a registration on the replacement vehicle (transfer of vehicle plates or vehicle registration);
* between the date the insurance is cancelled and the date the same insurance company reinstates your insurance coverage.
If the lapse in the insurance coverage exceeds 90 days, your driver license is also suspended.
What action does the DMV take if I do not have insurance and I do not surrender my vehicle plates immediately?
If you do not have insurance coverage and you do not surrender your vehicle plates to the DMV, your registration and driver license are suspended indefinitely.
If you had a lapse in your insurance coverage and did not surrender your vehicle plates immediately, your registration is suspended for the same number of days that you did not have insurance coverage, but did hold the vehicle plates. If the time is more than 90 days, your driver license is also suspended for the same number of days as the registration. To reinstate your driver license, you must pay a termination fee of $25 when the suspension ends.
How do I prevent a suspension if my liability insurance lapses?
You can prevent the suspension of your registration and driver license if you surrender your vehicle plates to the DMV before your liability insurance lapses.
You are not required to surrender your vehicle plates for a suspension of 90 days or shorter if you pay a civil penalty. You cannot use the civil penalty option if the lapse is longer than 90 days or you used this option in the past 3 years.
The civil penalty amounts shown below are the amounts for suspensions that take effect on or after October 1, 2005. For suspensions that take effect before October 1, 2005, the civil penalty is $8 for each day of the lapse. The civil penalty amount is:
* $8 per day for each day of the lapse from day 1 through day 30, and
* $10 per day for each day of the lapse from day 31 through day 60, and
* $12 per day for each day of the lapse from day 61 through day 90.
For example, if you had a lapse of insurance for 85 days, your civil penalty is calculated as follows:
* $8 x 30 days ($240) for days 1 through 30 of the lapse, plus
* $10 x 30 days ($300) for days 31 through 60 of the lapse, plus
* $12 x 25 days ($300) for days 61 through 85 of the lapse
* for a total civil penalty of $840.