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Do you need insurance to register a car?

Here's what you need to know...
  • Before a vehicle owner is able to register his or her car, proof of insurance is necessary
  • Most states will immediately suspend a car’s registration once it has been determined there is no insurance coverage
  • States track when drivers allow insurance coverage to lapse through a variety of means
  • Maintaining appropriate car insurance is a legal responsibility as well as a social one

Registering and insuring a vehicle go hand-in-hand in almost every state. In other words, it’s not possible to register a vehicle with your state motor vehicle department without providing proof of insurance coverage.

Even states which don’t mandate minimum liability coverage from a licensed insurance provider require proof of insurance. Such states still require individual proof of financial ability to pay accident claims.

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By tying registration and auto insurance obligations together, states theoretically reduce the number of uninsured drivers on the road. However, statistics show that in most cases where uninsured drivers are caught, a lapsed policy is the reason for being uninsured.

Do you need car insurance before you register your car?

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Before a vehicle owner is able to register his or her car, proof of insurance is necessary. Usually an insurance card or a printout detailing the type of coverage you have purchased is adequate.

The local Department of Motor Vehicles will need to see that the proof of insurance supplied is valid, lists the vehicle that you want registered, and provides the minimum amount of coverage.

It is not possible to register a vehicle unless you have a car insurance policy.

Even temporary coverage will work if you are able to fax or mail in a copy of your permanent car insurance policy within 30 days.

What can happen if I’m caught driving a registered car that has no insurance coverage?

The cost of car accidents can be extremely high, so states take the matter of carrying car insurance very seriously. Almost all of them will immediately suspend a car’s registration once it has been determined there is no insurance coverage.

Some states, like New York for example, give drivers a short period of time to surrender the car’s license plates once insurance coverage has lapsed. A failure to do so will result in suspension of your driver’s license.

In addition, most states also levy punitive fines to drivers caught on the road without adequate car insurance. In some cases the fines are accompanied by a penalty period in which the car can neither be insured nor registered.

The idea behind such punitive measures is to discourage repeat offenses among those who would allow their insurance coverage to lapse.

Such penalties still apply even in cases where you might be insuring and registering a vehicle titled in someone else’s name.

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How does the DMV know if my registered car no longer has insurance?

As stated earlier, it’s not possible under most circumstances to register a vehicle without proof of insurance coverage. As for those cases where drivers allow insurance coverage to lapse, states track this through a variety of means.

Some rely on ID cards compared to routine reports from car insurance companies licensed to do business in their state. Others utilize an electronic database which is regularly updated and can be accessed by both police and the DMV.

New York has the lowest rate of uninsured drivers in the nation at a mere 5 percent; the national average is closer to 10 percent. New York accomplishes this through a mandatory electronic system that all New York licensed insurance carriers must utilize.

Insurance provider computers are linked to the system so that every time a policy is changed the state is notified.

As soon as an insurance policy is allowed to lapse, the state DMV computer automatically generates a letter which is sent to the driver to encourage corrective action.

Is there any fool-proof way to make sure a car can’t be registered without insurance coverage?

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Under the current registration and insurance system there is no absolutely fool-proof method of making sure that every car on the road has insurance coverage.

Some experts claim that the current system could be improved by turning over registration and licensing responsibilities to insurance providers.

One theory is that the insurance companies could not issue license plates until they have insured a vehicle.  At the end of the policy, or at the time of lapse, those plates would no longer be valid.

Though privatizing the registration and licensing process does have its advantages, it still doesn’t prevent drivers from allowing insurance coverage to lapse while still leaving the plates on the vehicle.

In order for this system to work, a method of enforcement needs to be adopted. Something similar to bank repossession for a defaulted loan would work well.

If insurance companies were given the authority to repossess license plates after an insurance lapse, the system could probably reduce the number of uninsured drivers to a negligible number.

Maintaining appropriate car insurance is a legal responsibility as well as a social one. Not only are the potential fines and penalties for driving uninsured costly for you, but the costs incurred by other drivers in an accident you cause can be even higher.

Before heading down to the DMV to register your vehicle, find the best car insurance rates in your area for FREE by entering your ZIP code here now!

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