Since Covid-19 started spreading through the U.S., cities around the country have seen rush-hour traffic jams vanish as a result of lockdowns and social distancing. The Public Interest Research Group (PIRG) found that the household vehicle travel in the U.S. declined by 68% to 72% during the last two weeks in March and the first week of April of 2020, compared with the first week in March of the same year. Since then, national driving has normalized: the Federal Highway Administration’s Traffic Volume Trends indicate 2024 cumulative travel on the order of ~3.3 trillion miles—at or slightly above 2019 levels—and early 2025 readings continue to post modest year‑over‑year gains (FHWA; FHWA monthly). Congestion also tightened in many metros in 2024, with mid‑week (Tue–Thu) peaks as hybrid work reshaped commuting (INRIX; TomTom). Holiday and leisure road travel remain exceptionally strong—AAA forecast 38.4 million people traveling by car over Memorial Day 2024, the highest on record for that holiday. At the same time, hybrid/remote work has become durable, with roughly 28% of paid full days worked from home in 2025 and average office occupancy near half of pre‑pandemic baselines mid‑week (Kastle). With many people commuting fewer days but still driving for errands and trips, should drivers even consider canceling their car insurance policies? Here’s what current data and expert guidance suggest.
Be aware of the risks
When it comes to canceling auto insurance, the expert advice is straightforward: Don’t cancel it. In 2025, 49 states and D.C. require liability insurance to operate or register a vehicle; New Hampshire is the notable exception (financial-responsibility rules still apply) (New Hampshire Insurance Department). Lapses are detected quickly through state verification programs and can trigger fines, registration or license suspensions, and possible financial‑responsibility filings such as SR‑22, as reflected in statutes like New York VTL § 318 and Texas Transportation Code § 601.191. Any short‑term savings from canceling are often erased by penalties and the loss of continuous‑coverage discounts when you return to the market.
Besides being illegal in most states, Lev Barinskiy, CEO of SmartFinancial Insurance, says that when you don’t have an auto policy, you will have to pay out of your own pocket if you have an accident. The costs include medical bills for yourself and the other driver, damage to the other vehicle, and repairs to your car. Recent regulatory changes also raise the compliance bar: California’s SB 1107 increased minimum liability limits to 30/60/15 effective January 1, 2025 (California SB 1107), and Virginia repealed its “uninsured motor vehicle fee,” effectively requiring insurance for all registered vehicles as of July 1, 2024 (Code of Virginia). Keep proof of insurance handy—electronic ID cards are accepted in all 50 states and D.C. (III).
Ariana Gibson, Head of Driver Insights at Clearcover, says she wouldn’t recommend suspending an insurance policy even if you are not using your car because “you’ll want to keep your coverage if the vehicle is damaged or vandalized while parked. We are entering the season when storms can bring hail or wind to knock down tree branches.” There are other non-driving risks such as fire, floods and thefts that are covered by your car’s insurance. Industry data also show claim severity remains elevated due to repair and medical cost inflation, which makes adequate protection important even if you drive less (LexisNexis 2025 Auto Insurance Trends).
If you still decide to cancel your auto policy, Barinskiy recommends that when it’s time to buy a new policy, you should shop around to improve your chances of landing a better deal. “Be aware that you will be paying more for auto insurance now that you have a lapsed policy on your record. But you may find a company that will charge you less than others. And that’s the company for you following a car insurance lapse,” Barinskiy says. To avoid enforcement actions and higher future premiums, overlap any switch by 1–2 days so there is no gap in liability coverage, respond promptly to any state verification notices, and understand potential SR‑22/FR‑44 requirements where applicable (Virginia DMV).
7 Ways to Save on your Car Insurance
Instead of canceling your policy, experts recommend aligning price with how much and when you actually drive. Hybrid work has stabilized with roughly 28% of paid days worked from home and office occupancy around 50% of pre‑pandemic norms (Kastle), while overall U.S. miles remain near or slightly above 2019 levels (FHWA). If you’re looking for ways to trim your car insurance payment, here are focused, research‑backed adjustments.
- Ask for a Car Insurance Lapse Grace Period
Barinskiy says that some auto insurance policies offer brief payment grace features, but state electronic insurance verification means lapses are flagged quickly and can lead to administrative suspensions if you don’t respond. If you fall behind, contact your insurer immediately to keep the policy from canceling, and be aware that penalties for driving uninsured can include fines, registration/license suspension, and SR‑22 filings (see NY VTL § 318; Texas § 601.191). Keep electronic proof of insurance—accepted in all 50 states and D.C.—readily available (III).
- Enroll on a Low Mileage Tracking System
When your driving habits change, there might be more cost-effective ways to pay for what you use. Gibson encourages you to ask your agent for options like a low mileage tracking system with telematics to get some deductions. This way, you can determine your rates based on your actual driving habits and skills. Adoption of usage‑based insurance has risen—about 23% of U.S. auto customers participated in 2024—and programs now support multiple data options (smartphone apps, OBD‑II devices, connected‑car data, or periodic odometer photos) to balance accuracy and privacy (J.D. Power; NAIC; LexisNexis).
- Raise your Deductibles
Brent Thurman, president of Keystone Insurance Services, recommends raising your deductibles during the period that your vehicle won’t be driven. Even if this makes the deductible higher if you were involved in an accident, your premium will be lower. Ensure you can comfortably cover the higher out‑of‑pocket amount, noting industry reports show claim severity has remained elevated due to parts, labor, and medical inflation (LexisNexis).
- Reduce your Coverage
Kristen Maurice, from Advocate Insurance, says that a better option would be to reduce the coverage. For example, instead of paying for full coverage, you can switch to your state’s minimum liability coverage. This is a great option if you are only driving to go buy your weekly essentials. Before changing limits, confirm your state’s current minimums and any lender requirements: several states raised minimums recently—California to 30/60/15 in 2025 (SB 1107); Virginia to 50/100/25 in 2025 and insurance now required for all registered vehicles (Virginia DMV); New Jersey increased BI minimums in 2023 and again in 2026 (NJ DOI); Arizona moved to 25/50/15 in 2020 (AZ DIFI); Michigan requires at least 50/100/10 and PIP selection (MI DIFS).
- Eliminate Road Assistance
Call your agent, ask to cut out road assistance for a while. If you are only driving a mile or two to go to the grocery store once a week, this could be useful to save some money, says Gibson. However, if you expect holiday road trips, remember demand spikes—AAA forecast a record 38.4 million traveling by car for Memorial Day 2024—so weigh the value of keeping at least one roadside option for peak‑travel periods (AAA).
- Switch Providers
Patrick Nugent, a photographer from New York City, wanted to switch insurance during the shutdown. He was not pleased that his previous insurer did not offer a small rebate on their policies as other insurers did. He spoke with an insurance agent who got him quotes from different providers and found a cheaper insurer. His current yearly saving is $336, a pretty solid deal. After a few weeks of switching to the new company, they issue him a $20 statement credit for the current situation. Today’s market makes shopping even more worthwhile: the CPI for motor vehicle insurance has shown sustained double‑digit year‑over‑year increases, fueling near‑record shopping and switching rates (BLS CPI; J.D. Power Shopping Study; TransUnion Trends). Get 3–5 bindable quotes, compare coverage limits and deductibles, and ask each carrier to rate your actual annual mileage or offer a UBI discount.
- Find Yourself a Pay-per-mile provider
If you are driving substantially less, you should look for usage-based car insurance companies. Digital Insurance Companies such as Metromile and Root promise to save 50% yearly for drivers who don’t travel too much. In today’s pay‑per‑mile (PPM) offerings, most carriers use a hybrid structure: a fixed base premium for continuous coverage plus a variable per‑mile charge, often with a daily cap that bills only the first ~250 miles/day on long trips. Examples include Allstate Milewise and Nationwide SmartMiles; privacy‑forward options like Mile Auto verify mileage via monthly odometer photos, while app‑centric programs such as Lemonade Car blend miles and driving patterns. PPM tends to benefit consistently low‑mileage drivers (often under ~6,000–8,000 miles/year), multi‑car households with a seldom‑used vehicle, and hybrid workers; availability and eligibility vary by state. For transparency on data use and consent, review guidance from the NAIC and the Insurance Information Institute before enrolling.
