In order to cancel the insurance policy, one has to return license plates. In addition, when people sell their car or cancel their car insurance policy, the time turning in the license plate is significant. However, if one drives the car without insurance, there is a minimum fine of $5,000, but the fines vary from state to state, and one will have to go to jail for at least 6 months.
If folks can’t insure their vehicle, removing the license plate is a good decision. Many states have a rule that if drivers sell their vehicles, they need to turn in a license plate. Furthermore, people must contact their state’s DMV or the department of Motor Vehicles to confirm whether there is a need for a plate or not before removing the insurance policy.
Why is It Necessary to Turn in the License Plate to Cancel Insurance?
Returning a license plate is vital to cancel the insurance policy. In addition, to cancel the car insurance, the first thing to do is to submit the license plate surrendering proof that ensures the authority that you turn in the plate.
Most people don’t know how they can turn in the license plate, so there are some steps that they should follow, including:
- To get the receipt, visit the tax collector or DMV office to return the plate
- To complete the whole cancellation process, submit the insurance provider’s receipt.
Recent data from the insurance information Institute show that around 13% of drivers are uninsured, and states want to reduce that number of uninsured driver’s number, so they need this process. However, states don’t want people to cancel their vehicle insurance, but it is compulsory to return the license plates.
Can Drivers Return Their License Plates Temporarily?
Most people may have the confusion that it is acceptable if they turn in plates temporarily. The answer is yes; there are several states that let people temporarily return their license plates. You can understand with an example that for a while, one is prohibited from driving, so in this situation, one may have to return the license plates until one decides to start driving again.
In addition, if any person’s driving rights were canceled for a Dui or irresponsible driving, they may have to surrender their license plates. In these kinds of cases, it is a legal requirement to give back these plates for a particular number of days or months.
What to Do if the Plate is Lost?
Suppose, before turning in the plate, it was stolen, destroyed, or lost so what is the way to get rid of this situation? So in this situation, the first step is to file a police complaint and submit it to the tax collector or DMV office as proof.
Furthermore, people don’t have to pay a massive amount in the form of a fee if they only need a new license plate.
Sara Routhier, Director of Outreach at 4AutoInsuranceQuote.com, suggests that people should follow some steps to receive the new plate:
- Vehicle registration
- Driving license
- Police complaint report or old license
- Insurance proof
Individuals can file a complaint about the missing plate if they don’t want to get a new one.
Can One Cancel the Policy Before Returning a License Plate?
Most of you may be eager to know what happens in case one doesn’t return the previous plate. The answer is that many states may not cancel your license if you don’t return the plate to them. The reason is that it is the first condition of many states that one can remove the insurance policy after submitting the plate.
Why Do Insurance Providers Transmit the Details to the DMV?
It is necessary for the insurance providers to virtually submit the insurance coverage information to the DMV of the state. Suppose any person doesn’t longer continue the insurance policy, so the Department of Revenue gets notified by the vehicle insurance company.
For submitting all the insurance details from the starting and ending date of coverage, insurance providers are usually given almost 30 days. The tax collector makes a data sheet to fill in these insurance details. Other than details database add things such as:
- Insurance states
- The plate number of the vehicle license
However, a few states have laws that people should have liability insurance policy coverage if individuals don’t instantly get coverage or cancel the insurance policy, so the registration will be canceled too.
Is Car Insurance Different Than Auto Insurance?
When folks register their vehicle with the DMV, they obtain the vehicle’s license plate. In simple words, the license plate is associated with the vehicle registration but isn’t allied to the auto insurance policy.
However, auto insurance and car insurance have some connection. Therefore, it is necessary for the insurance provider to contact the DMV to discuss the insurance policy status.
Different states impose different penalties on drivers who don’t have an auto insurance policy, so one must have auto insurance in the case of a registered vehicle.
Is There a Low Regarding the Lapse Fees?
Various states have different laws related to lapse insurance coverage, and the DMV of a few states charges certain fees for it. The fee ranges from $25 to $50, depending on the state where you live.
For example, if someone cancels the old auto insurance and doesn’t get the new one within 10 days, the DMV can impose a penalty on them and have to pay the amount.
In addition, the DMV has the power to suspend your car registration in case you don’t submit the amount within a month. However, a few states impose a lapse penalty each day if one doesn’t have insurance coverage.
Conclusion
Most states require people to have a minimum amount of vehicle coverage, regardless of whether the vehicle is new or old. Individuals will have to return their license plates to the DMV to cancel the insurance policy. It is much better to have liability car insurance than to be uninsured.