What happens when your car insurance is canceled?

If you live in a state that requires you to carry car insurance and your policy is canceled, the DMV will be notified of your lapse in coverage and legally you will not be able to drive your vehicle. The DMV may charge you a fine for the insurance lapse, and it can also suspend your license and registration on the vehicle. Depending on the length of time your policy was inactive, your insurance premiums may also be noticeably higher when you obtain new coverage due to the lapse.