Do I Need Insurance on a Broken Down Car?

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Yes, your car needs to be insured, even if you’re temporarily taking it off the road due to needed repairs. Most states require insurance for registered cars. And if your car is financed, the lender will also likely require you to maintain insurance.
If your car is undrivable, and will be for the foreseeable future, consider reducing your insurance to comprehensive-only coverage.
Sure, the knee-jerk reaction to an undrivable car is to cancel an insurance policy. But in reality, canceling your auto insurance might end up costing you a lot more in the long run (through insurance lapse penalties and gaps in coverage you may need).
Thankfully, the insurance comparison and shopping app Jerry has put together everything you need to know about insurance and broken-down cars.
Need a policy of your own? Signing up just takes 45 seconds, and saves users an average of $879 per year! No phone calls, no paperwork—and Jerry will even cancel your old policy for you!
Here’s what you need to know about insuring broken-down vehicles.
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Never let your insurance lapse

If your car breaks down and you decide not to fix it right away, do not cancel your car insurance.

Because your insurance cost might increase when you reinstate

Drivers with a history of lapsed policies are considered higher risk by insurance companies. Higher risk equals higher insurance premiums. That means, getting rid of your car insurance, however temporarily, will likely drive up your premiums.

And you could face government fines

The government won’t be too happy about your insurance lapsing, either. Most states require all registered motor vehicles to remain insured.
Many states will issue fines for lapses in insurance. Some states can even suspend your driver’s license for not having your car insured, even if it’s broken down and stored (and therefore undrivable).

… And you might need insurance coverage

If you don’t have car insurance, and your broken-down car is damaged by a peril that would have been covered by insurance (like vandalism or a collision), you will be stuck paying those expenses entirely out of pocket.

Ways to reduce insurance costs on your broken-down car

You need to maintain insurance on your undrivable vehicle, but that doesn’t mean you should be paying for full coverage. Here are some ways to reduce your insurance costs on a vehicle you aren’t driving.

Reduce your insurance to comprehensive-only coverage

If you are storing your undrivable car until you fix it or sell it, consider reducing your coverage to a comprehensive insurance policy while removing liability coverage and collision coverage.
This will keep your car covered in a disaster while satisfying the minimum requirements of auto lenders and your state’s Department of Motor Vehicles.
Just be sure you check with your lender, your local DMV, and your insurance provider first to make sure this will satisfy their minimum requirements for insurance.

Purchase car storage insurance

If your car is paid off, you might also consider getting car storage insurance. This will help protect your vehicle from theft and the elements. The DMV will also consider the car insured, letting you avoid fines, canceled registrations, and other penalties associated with lacking insurance.
This might sound like an ideal solution. But it’s important to note that most insurance providers will insist on the vehicle being kept safely in a parking garage or storage unit. You’ll likely have to pay to tow the broken-down car from your home to the garage or storage unit. And these added costs probably won’t be cheaper than simply getting comprehensive insurance to begin with.

What if my car has a loan?

Generally, if your car is financed, the lender will require you to maintain insurance until you’ve finished paying the car off.
If a lender finds your car to be uninsured, they’ll usually take out third-party insurance for your vehicle and send you the bill.
Needless to say—your lender isn’t going to use a price comparison and broker app like Jerry to shop around for the best deals, either. Chances are this new policy will be far more expensive than the insurance you had prior to your car breaking down.
Why are auto lenders so finicky about keeping a broken-down car insured? It’s because your car isn’t necessarily safe sitting in your driveway.
Theft, storms, falling trees, flooding, fires … your broken-down car can be damaged, or even totaled, by forces well outside of your control. And without some form of insurance, you’re on the hook for all of those potential costs.

The Jerry app can help you find cheap car insurance

The short-term savings of canceling your car insurance might seem appealing, but the long-term costs, not to mention the headaches, make that a bad idea.
Thankfully, Jerry can help you find cheap comprehensive insurance that will keep your vehicle insured and safe while you save up for repairs.
Jerry is a licensed broker and will help you find and compare the cheapest comprehensive policies offered by brand-name car insurance providers.
Signing up is free and takes less than a minute. Best of all, the Jerry app can cancel your old policy for you, and takes care of all the annoying phone calls and paperwork so you don’t have to.
That’s not where Jerry’s usefulness ends, either. When your broken-down car is finally repaired, Jerry will help you compare new policies and find cheap car insurance that’s perfect for your needs.

FAQs

Do I need to keep insurance on a broken-down car?

Most states require all registered motor vehicles to be insured. If you used a car loan to buy your car and you’re still making payments, most lenders require you to have active car insurance as well.

Does insurance cover my car breaking down?

If your car is damaged in an accident, your insurance will likely pay for the repairs. If another car is at fault, they should pay for the repairs.
But policies don’t typically cover regular wear and tear or mechanical faults. If your broken-down car is still covered under a warranty that warranty might cover the costs.
Jerry deserves more than 5 stars. It is SO EASY and the results are SO GOOD. I gave very little info and it pulled up all my existing insurance info and showed me how to get the same insurance for less, lesser coverage for huge savings, or better coverage for about the same I currently pay. I am personally saving around $1,400/year with my new insurance, and the entire process took less than an hour.”—Emma P.
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