Penalties for Lapsed Insurance Payments

In order for a car or motorcycle insurance policy to be of any use, it is important for both the client and the insurance provider to uphold their ends of the contract. For the insurance company, this means providing the benefits spelled out in the policy’s description. For you, the client, this means making your premium payments as they are due each month.

If you fall behind on payments, there can be steep consequences. To protect yourself from legal and financial complications, you need a clear understanding of your rights and obligations under the contract you have signed. If you need a more reliable or affordable insurance policy, Insure on the Spot can help. Call our Chicago motor vehicle insurance agents today at 773-202-5060.

The Importance of Making Timely Payments

Each state has its own laws regarding insurance companies’ obligations towards clients who are behind on payments. Unfortunately, Illinois does not offer many protections for drivers who are behind on their insurance. While life insurance policies may be required to offer a grace period – a month or so during which you can catch up on late payments without losing your insurance – car insurance companies do not have this obligation.

If you fail to make your payments regularly, your insurance company has two options for penalizing you: they can increase your premiums substantially, or they can cancel your policy outright. Unfortunately, having a cancellation due to non-payment on your record can affect your premium rates when you are looking for a new policy.

Despite this, it is important to be honest when looking for a new policy. If you do not report your prior cancellation on your insurance application, and the company discovers the truth within 60 days, your new policy can be cancelled. If you are struggling to find affordable insurance due to problems on your record, our Chicagoland car insurance agents can help.

Contact Us

Insure on the Spot makes finding Chicago auto insurance quick and easy. Contact us today at 773-202-5060.