Do Still You Need Insurance if Your Car Is in Storage?

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Car in storage (Photo: @KiraYan via Twenty20)
Car insurance can save you from financial disaster if something happens to your car, and it can also save you from a lot of legal trouble. Unless you live in Virginia or New Hampshire, it’s illegal to drive a car without car insurance, and even in those states it’s not a good idea at all. Simply you put, you should really never even consider driving a car without insurance.
What if you’re not driving your car, though? What if your car is just hanging out, not being driven? There are plenty of reasons why you might have a car in storage; perhaps you’re headed out of town for a long time, or maybe it’s a project car that you’re working on but not yet ready to drive. Maybe it’s a car with sentimental value, or a collectible. Whatever the reason, if you’re not driving your car, you might think it doesn’t need insurance. But is that actually the case? Here’s what you need to know.

Do you still need insurance if your car is in storage?

Under most circumstances, you do not need to keep your car insurance if a car is in storage. As long as you’re not driving your car, you’re not legally required to carry insurance on it, and you can’t get in any trouble with law enforcement for not carrying insurance. However, there are some cases where you still need insurance for a stored car.

When do you still need car insurance for a car in storage?

You might need to keep your car insured if you are still making payments for it, whether you purchased or are leasing the car. The reason for this is that many lenders and financial institutions require you to maintain car insurance while you are making payments, because they want to be sure that their investment is protected. So if you are still making payments on your car, check the terms of your lease or purchase to determine if you still need car insurance even when the car is in storage.

Downsides of having an uninsured car in storage

When a car is in storage, it’s far less likely to be damaged. You don’t run the risk of crashing it, or having someone rear end it. But it’s not fully safe from damage. A car in storage can still be damaged by a flood, a fire, a falling tree, a vandal, or any other number of perils. If your car isn’t insured, it won’t be protected if it’s damaged, even if it’s just sitting in the garage.
Another downside is that if you want to drive the car, either to move it or just for a joyride, it won’t be insured and will likely be illegal to drive.

Can you partially insure your car when it’s in storage?

Yes, with most insurers you can partially insure your car to keep it protected in storage while lowering your premiums. In general, car insurance is composed of three parts: collision coverage (for when you’re in an accident), liability coverage (for when a person is injured), and comprehensive coverage (for when your car is damaged but not because of an accident).
When driving, you usually need all three elements of coverage, but many insurance companies will let you downgrade to just comprehensive coverage if your car is going to be in storage. However, you’ll need to remember to reinstate your full coverage when you start driving again.

What if you have to move your car from one storage location to another?

Some insurance companies will offer single-day or other short-term insurance options if you need to move your car from one storage location to another. If your insurer doesn’t, you might need to have your car towed.