If you have a car that is at the end of its life, you may be wondering what to do with your insurance policy. Perhaps it is time for an upgrade and you are about to purchase a new car. Or maybe you have decided to keep your current vehicle but need to make repairs that will be costly. Whatever the reason, there are several things that could happen if you choose not to scrap your vehicle right away. This article will discuss whether or not it’s worth keeping insurance on a scrapped vehicle and what should I do with my car insurance when I scrap my car?
Is it worth keeping insurance on a scrapped vehicle?
You can keep the insurance. If you’re still paying for a car that has been scrapped, it’s worth considering keeping the insurance on it. This is especially true if you have an older model which is worth more than it would cost to replace its parts. Your existing insurer might not be able to provide cover for a new vehicle at the same price as your current premium, but they may offer you a discount anyway to encourage you to remain loyal.
You can scrap it and then keep the insurance. If your scrap yard offers cash for cars with cover, then this option could make sense if the value of your car isn’t high enough to cover replacement costs, or you want money in hand instead of having to wait several weeks for payment from an insurer (some companies will pay out immediately).
What should I do with my car insurance when I scrap my car?
When you scrap your car, it’s important to notify your insurer. You may need to pay a cancellation fee or the cost of any outstanding payments on your policy before canceling it. You should also check if you have any outstanding payments on your policy before scrapping the vehicle as this could affect your cover in the event of an accident.
Besides that, it is of utmost importance to discard the scraped car in a proper way. If you are in Canada, contact the scrap car removal Mississauga crew to take this task off your hands.
What happens if you don’t notify the insurer?
If you don’t tell your insurance company that you’ve scrapped your car, then the policy will still be in force. If someone has an accident with your car and it isn’t insured, then they can sue you for loss of earnings or other damages.
However, if you tell them about the accident and scrap the vehicle straight away then there won’t be any problems for them to deal with. You will still be covered under the terms of your insurance policy as long as any outstanding payments have been made on time and there aren’t any outstanding debts on the vehicle (e.g., parking tickets).
It’s important to remember the three steps above when scrapping your car. Contact your insurer, cancel your insurance and let the DVLA know that you’ve scrapped your car. Failure to do so could result in big fines and penalties!