When Can I Drop the Insurance on my Personal Auto?

If I’m Not Driving My Car, When Can I Drop the Personal Auto Insurance?

We get some variation of this question all the time:

  • my car is broken down and I’m not going to fix it for a couple months…
  • my car is on cinder blocks and not going anywhere…
  • my elderly parent is no longer driving their vehicle but will not sell it…
  • I own a classic car that I work on just for fun but don’t drive…
  • I’m selling my car next week…

…do I need to keep the auto insurance on the vehicle?

The short and quick answer is YES if it has a South Carolina license plate on the vehicle.  But let me explain a little.  In the state of South Carolina, you are required to maintain liability limits at a minimum of $25,000 bodily injury per person/$50,000 bodily injury per accident/$25,000 property damage on any registered vehicle (i.e. has a SC license plate).

Per the South Carolina Department of Motor Vehicles, “If you have a South Carolina license plate on the vehicle then you must maintain insurance on the vehicle or you must turn the license plate into your local SC DMV office before removing insurance from the vehicle or you can be suspended and penalized for no insurance.”

More information about SC Motor Vehicle Requirements can be found here: http://www.scdmvonline.com/DMVNew/

If You are Looking to Save Money

So if you are looking for ways to save on your auto insurance, dropping coverage on a vehicle you no longer drive but is still tagged is not the way to go.  You can get slapped with a hefty fine if the SC DMV catches you.  And believe me, the DMV has gotten smart!  Their computer systems “talk” to insurance companies’ computer systems.  If they find that information does not match (even something as simple as a Vehicle Idenfication Number (VIN) mismatch), they will mail you a letter notifying you they will suspend your license and registration unless you or your insurance agent can provide proof of current coverage.  However, you could look at reducing your auto coverage on that vehicle to help save you some money.  Call your independent insurance agent to figure out what makes sense for you and your auto!

How to Legally Drop the Insurance Coverage on a Vehicle

The only way to legally drop the insurance coverage on a vehicle you still own in the state of SC is to turn in the SC license plate to the DMV then cancel the auto coverage that same day.


About Joe Popkowski