Impact of Revocation of Automobile Insurance Coverage on Vehicle Insurance Premiums
Life on Four Wheels: What Happens When You Get a Driver's License Suspension
When you break the traffic rules, the consequences go far beyond the fines and points deductions. Your driver's license might face suspension, and that could lead to a tempest in your everyday life and a hassle with your car insurance.
Here's the legal lowdown:
According to Article L.113-2 of the Insurance Code, you're obligated to inform your insurer about any new circumstances that worsen the risk or bring up new risks. Since a license suspension is a fresh circumstance that could change your risk profile, you simply gotta spill the beans to your insurer.
Now, let's see what your car insurance policy has to say:
Usually, the General Conditions of your insurance contract remind you that the pricing is based on the details you provided in the application form. Any risk modifications that contradict your previous answers and aggravate the risk calling for your attention, such as alcohol or drug convictions, hit-and-run, or traffic code violations resulting in a license suspension.
What can go wrong:
Based on the severity of the infraction and the duration of the suspension, the insurer might take various actions, including slapping on a premium hike or even axing the contract. Article A.121-1-2 of the Insurance Code ensures that your insurer has the right to hike your premium.
A license suspension lasting up to two months normally earns a pass from insurers, but it might not apply if your insurer requires you to declare every license suspension irrespective of duration. If your license is canceled for two to six months, your insurer might sock you with a 50% premium increase. A suspension surpassing six months means you'll have to pay double the premium. You have the right to refuse the surcharge, but then your contract gets axed by the insurer.
Multiple suspensions within a three-year span will contribute to a 200% surcharge, which triples your premium. However, you get a reprieve after two years of breaking free from any new suspension.
Bonus tip: Driving while suspended can lead to contract cancellation by the insurer, especially if the suspension follows an accident caused while under the influence of alcohol or drugs.
Don't forget:
The law demands that you inform your insurer about your suspension within 15 days by registered mail. A detailed letter with your vehicle's registration certificate and the suspension notification should be sent. Failing to comply can lead to severe consequences as the insurer might reject your coverage in case of an accident. The insurer also has access to the National Driving License System and can verify your driving status after an accident.
A suspended license can hurt your car insurance, but it doesn't have to be the end of the road. Know your options, stay proactive, and drive carefully to get back in the driver's seat again.
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Insight:
- A driver's license suspension can lead to higher insurance premiums, difficulty in obtaining coverage, and the requirement for SR-22 or FR-44 certificates.
- If you are in the middle of an insurance policy term and your license is suspended, avoid canceling your coverage to prevent a gap in coverage that can boost your rates.
- Shop around for insurance providers that offer coverage for drivers with suspended licenses, and remember that maintaining good credit can help reduce insurance premiums.
- Prepare for potential rate increases after a license suspension to manage the costs effectively.
If your driver's license is suspended due to traffic code violations, you are obligated to inform your insurer about this change, as it could affect your risk profile and potentially lead to a premium increase or cancellation of your policy. Moreover, engaging in entertainment activities like driving a go-kart or attending a themed driving experience during your suspension period could potentially be seen as a breach of your suspension terms and potentially worsen your insurance situation.
