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Do I need car insurance when my car is parked for the winter?

If you park your car during the winter you should keep it insured. While you may think you can save money by cancelling your car insurance for a vehicle parked for the winter it may end up costing you more in the long run.

Here are three main reasons to keep your vehicle insured over the winter:

  • You may be required by law to have liability coverage if you park your vehicle on the street.
  • A vehicle can suffer damage even if it’s parked.
  • There may be penalties for cancelling your car insurance midterm.

Legal Requirement to Have Third Party Liability Coverage

In some jurisdictions you are legally required to have third party liability coverage on a vehicle that is parked on the street. Why? If for some reason your vehicle rolls and hits another car or person or property they could make a claim against you for property damage or injury. The third party liability coverage as part of your car insurance can help cover these expenses.

If you do plan to cancel your car insurance on a parked car (or are parking it in a garage or private property) ensure there are no insurance requirements for parked vehicles in your city or county and province.

Remember if you drive your vehicle even a block it is required to be insured with third party liability car insurance.

A Vehicle Can Suffer Damage Even If It’s Parked

You may want to keep comprehensive coverage on your parked car over the winter to protect your vehicle from:

  • Physical damage
  • Theft
  • Hit and runs
  • Vandalism

For example let’s say you’ve parked an older vehicle in the garage. Unfortunately there is a fire that physically damages your car. This would likely be covered by the comprehensive coverage of your car insurance. If you didn’t have this protection however you’d be on your own to repair or replace the fire-damaged vehicle.

Here’s another example: you have a vehicle parked on the street with liability coverage but you’ve removed the collision and comprehensive coverage. Unfortunately some hooligan breaks into the vehicle doing quite a bit of damage. Because you don’t have comprehensive coverage you’ll need to pay to fix it yourself.

Penalties for Cancelling Your Car Insurance Mid-Term

There may penalties for cancelling your car insurance mid-term such as:

  • Fees
  • Insurance history interruption or ding

Car insurance companies may offer you higher rates if you frequently cancel mid-term or have inconsistent insurance history. You may also pay a fee for mid-term cancellations. However you will not be charged your subsequent premium if you pay monthly and will be refunded a portion of your premiums if you pay annually.

Cancelling Your Car Insurance for Parked Vehicles During Winter

If you do have a vehicle that is not driven over winter and you want to cancel your policy ensure the vehicle is parked on private property with the most protection possible. Ideally the vehicle should be parked in a secure garage.

There are a few things to keep in mind:

  • You may pay higher rates when you go to insure the vehicle again.
  • You’ll be paying out of pocket for any damage or third party damage or lawsuits.
  • If you drive your vehicle at all you are legally required to have third party liability car insurance.

Generally your premiums should go down if you speak to your broker or insurance company and let them know the vehicle is parked for the winter. You should talk to them about your plans and see what your options are to save money.