Serious driving offenses come with severe penalties. In addition to points on your driving record, steep fines, and possible jail time, you may need to have your insurance company file a form with your state confirming you have the minimum amount of insurance coverage. Although not technically correct, this is often referred to as SR-22 insurance. Because of the severity of the driving offense, drivers are generally required to have an SR-22 on file for three to five years.
- When you are required to have an SR-22 on file, your insurance company will report lapses in coverage to the DMV.
- Depending on your state, allowing your SR-22 coverage to lapse could result in the suspension of your license or vehicle registration, or you could be charged extra fees.
- Paying insurance premiums late could also trigger a notice to your DMV, so you must communicate with your insurance company if you think you might miss a due date.
What Is an SR-22?
The SR-22 form lets your state know that you've purchased at least the minimum amount of liability insurance required by your state. If your insurance lapses and you have an SR-22 on file, the insurance company will be required to notify the Department of Motor Vehicles (DMV) about it. This is why it's so important not to let your auto insurance lapse.
If you're shopping for auto insurance and you're required to file an SR-22, get multiple quotes and let the insurer know about the SR-22 upfront. Some insurers don't do SR-22s, but many do.
Every State Has Its Own Rules
What happens if you let your SR-22 policy lapse? Will they suspend your license? That depends on where you live. Laws vary from place to place and are governed by each state’s DMV. In general, the consequences for lapsing on your policy will include:
- Driver's license suspension: Your driver's license could very well be in jeopardy if you let your car insurance lapse when you're required to have an SR-22 on file.
- Vehicle registration suspension: No SR-22 on file usually means no vehicle registration once the state knows your coverage has lapsed.
- Fees, fees, and more fees: Once you let your SR-22 insurance lapse, the fees to get it reinstated can set you back significantly. There are fees for reinstating your license and your registration, and insurance companies often make you start from scratch—and often at a much higher rate. You may need to make a sizeable down payment and it's going to take longer to get out of high-risk status.
Paying Car Insurance Late
It's not just letting your car insurance policy lapse that can lead to trouble; paying late can cause a lot of problems, too. When you have requested an SR-22 filing, your car insurance company is responsible for keeping the state notified of your policy status.
Paying late can trigger a notice saying your policy is in danger of being canceled. Sometimes, it may even say it's canceled when you could actually be in a grace period. The frustration involved with late payments can be huge. Waiting in line at the DMV, proving you have coverage, and dealing with avoidable fees will all be in your future if you get behind on your car insurance payments.
Best Advice for SR-22 Filings
The best way to keep your insurance up to date is to sign up for electronic funds transfers (EFTs). Having your car insurance payment taken directly out of your bank account ensures your payments are on time, and many insurance companies give you a discount for signing up. You must have the appropriate amount of money in your bank account to cover the payments, though. If not, you could be looking at additional fees from your bank and insurance carrier.
Ask Your Car Insurance Agent for Help
If you find yourself in a tight spot, it never hurts to ask for help. The worst that could happen is you're told there is nothing the insurer can do. It's not unheard of for an agent to give you an extension on your payment due date. They can also get you proof of insurance immediately in case you need to take it directly to the DMV.
Knowing how the system works is your best bet for success. Fully understanding your car insurance policy can save you time and money. Keep your SR-22 filing intact for the required amount of time, which can be anywhere from six months to five years. Once you make it past your filing, start searching for a lower car insurance rate. Keep your policy active and your driving record clean to obtain the best car insurance rates.