Does debadging a car affect my auto insurance?

Your car can't be legally driven when you debadge your car so you may want to suspend your insurance coverage until your registration is complete again.

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Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates. He has also been featured on sites like UpJourney.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that ex...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Apr 24, 2020

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Things to Remember...

If your car is inoperable or you’re going on a trip around the world, it might feel like a waste of money to keep the car registered and insured.

When your car is sitting in a garage or parked in front of your residence, you may still have to satisfy auto insurance legislation unless you take the proper steps. The first step you’ll have to take is to debadge your car.

When you debadge your car, you are technically surrendering your right to do the following:

  • drive the vehicle
  • park the vehicle
  • tow the vehicle on public highways and streets

It’s something that you should only do when the car really isn’t going to be driven at all, not even for a quick ride around the block.

If you do debadge your car, here’s a guide on what you should do and how it will affect your need for auto insurance:

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All Cars Have to Be Registered Before They Are Driven

You can’t get on the road and operate a motor vehicle until it’s registered.

All private passenger cars, motorcycles, vans, trucks, trailers, and recreational vehicles have to be titled and registered through a state department before it can be driven by anyone.

To register a car, you have to have the following items:

  • Title or bill of sale
  • Application for registration
  • Evidence of emissions inspection on the vehicle
  • Proof of mandatory motor vehicle liability insurance
  • Proof that the vehicle has passed a safety inspection

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What does it mean to debadge your car?

People use a lot of different terminologies that you might not be familiar with that’s used in the insurance industry. One term is debadging.

In some areas of the world, instead of saying that someone is registering their car they are saying they are badging their car. When someone is saying that they are going to debadge the vehicle, it means they are surrendering their license plates to the DMV.

Surrendering your license plates isn’t the same thing as letting the registration expire by choice. When you turn in your plates, the car will be filed as a Planned Non-operational Vehicle.

This filing means it will have a different type of tag that says that the DMV is aware it’s going to be parked on private property.

Your registration has to be renewed every year in most states.

You’ll get a bill in the mail stating how much must be paid and when the payment has to be submitted. You’ll be given a grace period but must pay more money if you’re late. Eventually, the registration will expire for non-payment.

Why shouldn’t you let your registration expire?

When you let the vehicle’s tags expire, it affects how much you’ll have to pay to reactivate your registration when you’re finally ready to drive the car. The DMV sees it as a late payment and will charge you all of the past due balance and other reinstatement fees.

If you don’t pay the fees, anyone who tries to register the car in the future will have to pay. This makes the car difficult to get road-ready and also makes the car difficult to sell. It’s much easier to just officially debadge the vehicle so that you can avoid unnecessary charges.

What do you have to do to debadge your car?

Debadging your car isn’t all that difficult. Most of the time, you’ll have to take a trip to the DMV to complete the transaction. You may be able to make an appointment so that you’re not stuck in line.

Be sure to take a different vehicle when you’re surrendering tags. Here’s how to debadge your car:

  • Complete a Plate Surrender Application
  • Take your license plates and tags to a local DMV office
  • Pay the small surrender fee to process the change
  • Advise the agent that you want a temporary surrender if it’s just for a season
  • Ask what your credit for paid fees will be

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When should you surrender your tags?

You really shouldn’t surrender your tags for just any reason. It needs to be a valid reason or you could land yourself in a very difficult situation where you’ll have to drive the car and put yourself at risk of being cited.

Here are a few scenarios where you can surrender your tags without worry:

  • You are going out of town for months and no one will be driving the car while you’re away
  • The vehicle is inoperable and you won’t be repairing it in the near future
  • You are getting surgery and your vehicle won’t be driven while you’re recovering

Do you need to make changes to your insurance when you surrender your plates?

You can keep your insurance just the same if you’d like but it doesn’t make much sense to do that. You’ll be spending a lot of money for insurance that you won’t be able to use.

This excess spending is why it’s recommended to either cancel your insurance or suspend it so that you only have comprehensive coverage.

Suspending coverage is best if you want to keep your insurance history. You’ll still get loyalty and prior insurance discounts when you do this. If you don’t plan on buying a new car, you can cancel the policy and start over again if you ever buy a new car again.

You have to have insurance on a car to register it, but you don’t need a registration to buy insurance. Make sure that you make changes to your insurance policy when you take the leap to debadge your car.

If you need coverage again in the future, get online insurance quotes and compare rates first. Try using our free rate comparison tool today!

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