Understanding how temporary auto insurance works and instances when you may need car insurance for just one day, one week or even just a month and where to look for such policies.
While most of us think of auto insurance as an annul or semi annual insurance policy against the potential of liability damage and or collision insurance for our day to day driving needs – there may be times you may only need car insurance for a much shorter, temporary time frame.
Which raises the question, when might it make more sense to take out temporary auto insurance and what time frames are available?
First of the reasons why it may more sense to take out temporary car insurance:
- You’re renting a car.
- You’re borrowing someone else’s car and aren’t listed on their insurance policy.
- You’re temporarily driving someone else’s car to take a trip.
- You bought a car but plan to resell it relatively quickly.
- You’re traveling to another country and plan to drive while you’re there.
- You drive for a ride-sharing service but don’t own the vehicle you drive.
- You want to supplement your existing car insurance coverage.
- You need to add coverage for a driver who’s staying in your household temporarily.
For instance if you are renting a car just for the day, let’s say for an occasion and don’t want to take the risk of unforeseen events, the obvious question becomes: Do you need car insurance for just one day?
It might indeed make sense, especially if you are borrowing a friend’s car, test driving a potential new vehicle purchase or you might want to taken out your collectible vehicle which you generally keep in the garage and rarely take out – to insure in the event of unforeseen events.
On the other hand, you probably won’t need to take out daily or say weekly or monthly auto insurance if you’re renting a car with your credit card, and your card includes a rental car collision damage waiver to protect you against theft or damages while you’re driving. In that case you may not need any other supplemental coverage.
You could also potentially skip out on temporary insurance if you purchase coverage from the rental car company instead. Most rental car companies offer their own add-on insurance policies that you can include in your rental agreement. These policies cover you temporarily while you’re renting the vehicle.
What to Know When Buying Temporary Car Insurance
If you think you’ll need car insurance temporarily, there a few things to keep in mind before purchasing a policy. First, remember that it may be harder to find, as not all car insurance companies offer it. You can start with your current car insurance company, but you may need to do some research to find an insurer that offers short-term policies. Comparing temporary insurance options online can give you an idea of the coverage options available.
Next, consider the cost. Specifically, look at the premiums and deductibles as well as whether the insurance company requires any type of down payment or prepayment of monthly premiums. Remember, as this is temporary insurance, it may be more expensive than standard auto insurance coverage.
Perhaps most important, look at what’s covered by the policy. Liability insurance protects you against lawsuits if you’re in an accident and injure someone or cause damage to someone else’s vehicle. Collision coverage helps pay for repairs to your vehicle if you’re involved in an accident. The policy may also cover things such as medical payments and towing, depending on the insurer.
Keep in mind that your driving history and record can play a part in determining your premium amounts. If you’re deemed a high-risk driver because of frequent accidents or tickets, that could make temporary vehicle insurance more expensive.
