Can I register my financed vehicle as non operational to avoid paying insurance?

My insurance is expensive for my financed car. I want to get an older vehicle to drive instead. I'll still be making payments, but won't be driving my financed car. Can I register it as non operational?

Answer provided by
Emily Maracle
Answered on Jun 23, 2021
Emily Maracle is a car insurance specialist living in New York. Originally from the Pacific Northwest, she has a degree in English Literature and a background in customer service. She enjoys cooking, gardening, and living sustainably. In the future, she can't wait to upgrade to a hybrid or electric car.
“Whether you can remove insurance on your vehicle will depend on your finance agreement. Most lenders require that financed vehicles carry comprehensive insurance and collision insurance.
To carry these with insurance carriers, you’re also required to have liability car insurance.
Even if you’re still making payments and not driving the vehicle, lienholders typically want to ensure the vehicle is protected. If the vehicle is parked and a windstorm knocks a tree onto it, lenders want the damage to be fixed and covered under insurance.
You can reach out directly to your lender to find out what they require. If they don’t have any insurance requirements, you should be fine to register it as non operational and remove the insurance. If they do, you’ll need to follow them as you signed a contract when purchasing your vehicle.”

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