The auto insurance market can be confusing because of the number of different terms that auto insurers use. This can be further confused if you move from one state to another, as different states have different laws and regulations surrounding automobile insurance. Be aware of the different terms that insurers use to describe the different aspects of vehicle insurance. And know that their payment terms can help you pay the premium easier or save money.
Monthly Car Insurance
The most often used term for auto insurance payment is ‘monthly car insurance’. This may seem confusing to some because quotes and policies are often quoted in monthly terms or in six-month or annual amounts and then broken down into monthly payments. This breakdown on a quote into monthly auto insurance payments is first and foremost to show you as a policyholder what your car insurance per month cost will be. Yet, often you can opt to pay for your car insurance in full up front by cheque or online. Some insurers offer about five percent discounts for full upfront payment.
So remember that monthly car insurance quotes do not always refer to an actual payment arrangement but rather to an easy breakdown for comparative purposes in quoting. Be sure to check the policy and payment options to pay your auto insurance on a monthly basis.
Car Insurance Low Down Payment
Another term often used in describing the payment terms for auto insurance is the low down payment option. Technically no insurer will start insurance coverage without some form of payment, before the actual insurance is granted and takes effect.
If you cannot pay the policy up front in full, most insurers however offer what is called a low down payment option and allow you to pay monthly, as stated above. The low down payment can differ between insurers. Generally these low down payment agreements are essentially monthly payment plans with at least one month payment acting as the ‘low down payment’. You can also divide your premium into several installments as this may be cheaper than monthly option.
No Down Payment Car Insurance
Technically this type of car insurance does not exist. Most state laws require some form insurance proof to show policy is in effect which refers to payment for services. However, some companies do refer to their policies as no down payment auto insurance policies because you can pay the first month’s auto insurance at the beginning of the policy that will act as a down payment and start the policy. They may be called as no deposit car insurance as well. You can get cheap car insurance with no down payment from one of the insurers on our panel.
Low Deposit Car Insurance
Again, this is another marketing term and often refers to a policy that allows you to get an auto insurance policy with a payment that represents a percentage of the total policy. This percentage can vary from state to state and with every insurer. However if you are required to have an SR-22 which guarantees financial responsibility, most insurers will expect a higher down payment for car insurance.
Monthly Auto Insurance
Different from the first type of payments for auto insurance, this refers to those few companies that offer pay-as-you-go option that has become so popular in other industries such as cell phones. Pay as you go auto insurance still requires a monthly ‘base amount’ in your premium, but offers the second part of the insurance to be tallied based on the rate by the insurer and the amount of miles that you drive during the previous month. In this way it can sometimes be called pay as you go monthly car insurance.
The terms in this article do not reflect the myriad of ways that you can actually make your monthly payments which can include: direct debit, credit card, cheque, online payments and others depending on the insurer. If you are looking for cheap auto insurance with no down payment or monthly auto insurance with telematics you can get online quotes at CheapAutoInsurance.net.