Most motorists know that you must have car insurance. Most drivers in the UK are also aware of the SORN programme - Statutory Off Road Notification. It's a system the UK has in place to let the driver and vehicle licencing authorities know that you own a car but that it's off the road and thus is exempt from road tax and insurance. For example a project car that spends a year in pieces in the garage while you're working on it.
Tighter regulations are coming in shortly meaning that if you haven't filed a SORN, you still need to insure your car. The fact that the car is not being driven (and in some cases will be in pieces) and therefore could not be involved in an accident is no longer a get out clause when it comes to car insurance.
The new Continuous Insurance Enforcement Legislation states that if a car has not been declared as a SORN and does not have adequate car insurance, the registered owner can expect to receive a letter advising them of their obligations. This will be followed by a £100 fine if the letter is ignored. Carry on ignoring the notices and the vehicle will then be seized or clamped and court prosecution could follow. If the process reaches this stage, then fines up near the £1,000 mark will be issued.
It is worth noting that the legislation also applies to motorcyclists.
You can fill out a SORN declaration online : DVLA SORN programme