Can I throw away old car insurance policies?
Asked by: Jose Emmerich III | Last update: June 24, 2025Score: 4.5/5 (7 votes)
Should I keep old auto insurance policies?
In general, you should keep insurance policy paperwork until the policy has expired and all claims (if any were filed) have been settled. But there can be exceptions, especially if you own a business or are self-employed.
What to do with expired car insurance?
- Call. Call your previous insurance company and find out if your coverage has lapsed and, if so, how long you've been without car insurance coverage. ...
- See if your policy can be reinstated. ...
- If your policy can't be reinstated, get a new one.
What happens to unused car insurance?
If you call it quits before your policy renewal date, you'll likely receive a prorated refund for any unused premium. Just be aware that some companies charge a cancellation fee.
How long does a company have to keep insurance documents?
As a general matter, seven years is usually sufficient for insurance agencies to maintain client records–that is, seven years after the policy ends or claims can no longer be filed.
Is It Better To Cancel or Suspend Car Insurance?
How long should expired insurance policies be kept?
While you might have seen recommendations for three to ten years after expiration, experts now recommend that liability policies, even though expired, should be maintained indefinitely. When a claim is made, the insurance policy that was in effect at the time of the alleged event will have to be reviewed.
Is there any reason to keep old utility bills?
KEEP A MONTH
If you're self-employed, you may need your utility, cable and cell phone bills for tax purposes. Otherwise, you can dispose of them as soon as you verify your payment was processed.
Can I cancel my car insurance if I am not using it?
Depending on your state's rules and insurer, you may be able to pause your car insurance if you won't be driving for an extended period. If putting a pause on your car insurance isn't possible, you can reduce your coverages or cancel your policy for the time you don't need it.
Can you get a refund for unused insurance?
You have 21 days from when your policy begins or is renewed to change your mind. If you cancel within this period and haven't made a claim, you can get a full refund.
What happens if I don't renew my car insurance?
If your car insurance lapses, it means you don't have active coverage. If an insurance company sees that you had a period of time with no insurance, they might consider you a higher risk. Driving without insurance could also result in fines, tickets and a suspended license, depending on the rules in your state.
What to do after car insurance expires?
From the day your policy expires to the effective date of a new policy, you will not be covered and should not drive your vehicle. If you decide you want to renew your previous policy after all, your insurance agent may be able to reinstate your policy, though you may be subject to a penalty fee.
Can you keep leftover car insurance money?
The short answer is that yes, you can choose to do whatever you want with the insurance money, but you need to ask yourself whether or not this is the best decision. If you need the cash more than you need to pay for the repairs, then this might seem like the correct decision.
How do I record expired insurance?
When insurance is paid in advance, it is recorded in the prepaid insurance account. When the period of insurance coverage expires, the insurance premium is recorded as an expense. So an adjusting entry is made to record an insurance expense and credit the prepaid expense account.
At what point is car insurance not worth it?
If your vehicle is paid off, there are only a few instances that justify dropping collision coverage: Your vehicle's value is less than a few thousand dollars: If your car holds minimal value, collision coverage may not be worth carrying. This is especially true when a large car insurance deductible is involved.
Should I shred old utility bills?
After paying credit card or utility bills, shred them immediately. Also, shred sales receipts, unless related to warranties, taxes, or insurance. After one year, shred bank statements, pay stubs, and medical bills (unless you have an unresolved insurance dispute).
How long should you keep household bills?
One year is the standard, in case of billing errors or disputes. I'd probably go ahead and make it a little longer. Keep them for one year. Really, I think you should just get the electronic statements where available.
Can you pause car insurance if not driving?
You may be able to pause your auto insurance if you're not going to drive your car for a certain period of time. However, you may be unable to temporarily give up all of your coverage, depending on your state's laws, your insurer's rules and your auto lender's requirements.
Do you get money back when you cancel car insurance?
In most cases, you'll receive a prorated refund. For example, if you paid $600 for a six-month policy and you're canceling after four months, you'll receive $200 back from the insurance provider. In this case, there's usually no cancellation fee.
Can you get cash back from insurance?
If you've had your life insurance policy for several years, the insurance company may allow you to borrow from your policy's cash value. In most cases, you won't have to pay taxes on the money you borrow, but the insurance company will deduct interest payments from your cash value balance.
What happens if I get rid of my car insurance?
Remember that most states require you to have at least the minimum coverage for your vehicle even if you're not driving it. When you cancel your car insurance too soon, you can be subject to fines and even have your license suspended.
Is there a penalty for cancelling car insurance?
Depending on the auto insurance company, canceling your policy before the end of its term may result in a cancellation fee. State laws can determine if a fee is allowable. If so, it is up to the insurer to set that fee, which is often taken out of the prorated refund.
When to cancel old car insurance?
Don't cancel your current policy too soon
It might cost you an extra month's payment but it's worth it to wait until you receive documentation that your policy is 100% active. Also, be aware that the price an insurance agent quotes you might increase, especially in the case of life insurance.
Is there any reason to keep old insurance policies?
In general, if you don't have any open claims, you don't need to keep old, expired insurance policies. However, if you have any open claims or have been involved in an incident that may result in a claim, keep all paperwork related to the incident and your policy until the claim is resolved.
Is it safe to throw away old bills?
(Annual statements should be kept for three years.) Utility bills: Keep them longer (three years) if you need the bills as a record of business deductions for tax purposes.
Does the IRS destroy tax records after 7 years?
Does the IRS destroy tax records after 7 years? No, the IRS destroys most individual returns after 6 years, unless the timeline is extended because they are associated with an “open balance due.” For example, returns filed in 2019 will likely be destroyed in 2026.