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What happens if you don’t pay your car insurance ?

Insuring your vehicle is both a necessity and a legal obligation. This requires purchasing auto insurance from an insurer and paying insurance premiums regularly. However, it happens that certain insureds find themselves in a situation of non-payment and must therefore suffer the consequences.

At what point do you find yourself in a situation of non-payment of your car insurance?

Every auto insurance contract has a deadline for the payment of insurance premiums. It is generally annual but can be monthly or quarterly in order to facilitate payment to policyholders. According to Article L.113-3 of the Insurance Code, all insureds have the obligation to pay their insurance premium 10 days after maturity.

What are the consequences?

In the event of non-payment of the amount of the insurance premium after 10 days, the insurer initiates several types of proceedings.

Car insurance formal notice

The first step taken by insurers is the formal notice of the auto insurance contract. It is done by sending a letter to the insured to remind him of the payment of his insurance premium. The latter has thirty days from the date of dispatch to comply.

Suspension of the insurance contract

In the event of non-payment even after 30 days, the insurer will then be obliged to initiate the second procedure. It consists of the suspension of the auto insurance contract for 10 days and terminates the guarantees. In other words, the insured is no longer covered and will be responsible for covering the costs in the event of accidents. If the insured manages to get into good standing during this 10-day period, the suspension ends and the guarantees will be valid again.

Termination of the insurance contract

If the non-payment is still relevant beyond the 10 days, the insurer may, if it wishes, terminate the contract. Such termination takes place within a further 10 days, ie 50 days after the formal notice. It puts the insured in an illegal situation and puts him at risk of prosecution in the event of an accident. The insurer is also entitled to initiate legal proceedings against the insured in order to obtain payment of contributions. Other amounts can be added to it such as the costs of proceedings which can significantly increase the total amount of debt.

What can the insured do in the event of termination?

Several options are available to the insured in the event of termination of the auto insurance contract.

Negotiate with your insurer

The insured can negotiate with his insurer and obtain new payment terms from the latter. If accepted, he will benefit from the protection of his insurer, but will have to update himself in order to avoid a new termination.

Turn to a new insurance company

The insured may also decide to sign another insurance contract with a new insurer. However, he will have a hard time finding any, because he will be recorded in the terminated file and cataloged as a bad payer.

In short, all insureds must mobilize for the timely payment of their insurance premium in order to avoid contract termination and legal action.