What do you do if you decide to take a vehicle out of service, sparing yourself the cost of insurance?
You have a couple of choices but there have been some changes in DMV regulations.
If the vehicle is up for registration renewal, you can file it under Planned Non Operation ("PNO"). You are not required in this case to show proof of insurance. In my case this was a $17 annual fee, not the $60 registration fee. You cannot drive the vehicle legally and it cannot be parked on a public street.
The catch with PNO is that if you later wish to drive the car, you will need to register it and pay the original full fee, in my case $60. So there turns out to be an extra cost of $17 for the right to not drive the vehicle (go figure) but you do save on the cost of insurance, at least for a period of time.
If, however, the vehicle is currently registered, PNO is not an option. If you take the vehicle off insurance, the insurance company is required to notify DMV and it will suspend the registration, requiring a $14 reinstatement fee to be paid when you wish to reinstate the registration. In this case, the penalty is $14. In addition, you have the complication of having to clear the matter up with Vehicle Registration Financial Responsibility Program, not the normal DMV offices, or, in my case DMV services at AAA.
To avoid extra payments, the best thing to do is to notify the DMV when you take a vehicle off insurance by filing an Affidavit of Non Use. See the instructions for use of the form. DMV says it will then cancel the registration. This sounds like the worst thing if you intend to drive the vehicle again later but DMV indicates that reinstatement does NOT require payment of the $14 reinstatement fee. Understand? Not easy is it?
One AAA agent told me to wait for the letter of suspension before sending in the Affidavit of Non Use. This, however, seems to be the wrong thing to do because there will be a $14 reinstatement fee for a suspended registration whereas DMV will cancel ( a good thing) the registration if you get the Affidavit to DMV before they suspend the registration. Go it?
This information was cleaned by first talking with two agents at AAA and by following up with research on the DMV site.
DMV registration information