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The Risks of Driving Without Insurance

Auto insurance is one of the mandatory requirements before a vehicle can be allowed on any road. However, the number of motorists who still drive around without an insurance cover is still high. Most drivers cite financial reasons for driving without auto insurance. Some of them feel that they’re always careful on the road and are therefore unlikely to be involved in an accident. But what are the risks of driving without insurance? Here’s how driving without auto insurance could cost you:

1. Vehicle impounding
You don’t even have to be involved in an accident to experience the perils of not insuring your car. If you are caught driving without auto insurance, the police officer can impound and tow your vehicle to the police yard. Besides paying the impound fees, you are also likely to face other penalties if charged in a court of law.

2. Have your license suspended
Besides the impound fees and the penalties, you also risk having your driving license suspended. The duration of license suspension varies from place to place. Some localities may reinstate your license as soon as you take up an insurance cover while others have a set period of time before you can be reinstated. You are also likely to incur costs to have your license reinstated.

3. Pay out of your pocket when involved in an accident
If you are lucky enough to escape the attention of traffic officers when driving without auto insurance, then you will pay out of your own pockets in the event of an accident. If you are at fault, the other party can also sue you for compensation. Depending on how bad the accident is, you could suffer a huge financial dent. If the other driver is at fault, you could receive little to no compensation after an accident. Some localities don’t provide for any compensation at all for the uninsured. Basically, you are on your own if an accident happens while you are uninsured.

4. Imprisonment
In some areas, driving without auto insurance is treated as a misdemeanor offense. This is likely to attract a prison term, especially for repeat offenders. The jail term can be between six months and one year, with the possibility of an additional fine too. First-time offenders may be lucky to avoid imprisonment unless they cause an accident while uninsured.

5. Higher premium payments
After getting involved in an accident without auto insurance, you will be forced by the law to take up an insurance cover. The risk of getting a cover after an accident is that the insurers treat you as a high-risk driver and therefore you will be charged higher premiums than others. Besides that, the value of your vehicle significantly goes down after a serious accident and this attracts higher insurance premiums.

While avoiding auto insurance is often seen as a shortcut to saving funds, the truth is that it is not. It is better to budget for an insurance cover once a year than to rake up unplanned penalties and fines for driving without auto insurance.