There are times you may need short-term auto insurance to insure a vehicle, driver or situation. Sometimes solution may appear to be pretty easy like buying coverage for rental vehicles from the rental company. However, you may later find out that you have wasted your money since you already had coverage for it. Understanding the circumstances well help your insurer suggest the best product and help you find cheap temporary car insurance.
- What Is Short Term Car Insurance?
Short-term auto insurance can be defined as insuring vehicles, drivers and situations for temporarily, rather than buying a standard 6 monthly or yearly policy. Depending on circumstances, it may require only slight adjustments on an existing policy, set up a policy that can be adjusted as needed or buy a totally different coverage. So, a standard policy may solve a temporary auto insurance need or it may be necessary to arrange a non-standard policy.
- When Would You Need Temporary Car Insurance?
There can be tens of reasons why would anyone be looking to arrange short-term auto insurance and some of them are listed below.
Insuring Additional Drivers: This may be the case when you have a houseguest for a short period of time. The fact that they live in your house complicates the situation to a point that you may need to insure them specially.
Insuring Additional Vehicles: You may find yourself in a situation needing insurance for a car temporarily for various reasons.
Insuring a Situation: Again, you may need to make sure that certain activities are covered by insurance no matter how short is the arrangement for.
- When Does a Current Policy Offer Temporary Auto Insurance?
Before you start looking around for short term vehicle insurance coverage you should probably check if your exiting policy provide coverage for this temporary situation you are in. Have a look at various scenarios described below to see how helpful your current vehicle insurance can be.
Does my Car Insurance Cover Rentals?
A standard automobile insurance policy provides the same coverage you have on your car for temporary rental vehicles too. However, the key word here is “standard” in every sense. You need to check if your policy has any special exclusion before assuming an automatic coverage for rentals. Also, your coverage may only be available for a similar type of a car. For example, if you have a cheap sedan you really have to check with your insurer before going ahead and renting a high-end sports car for the weekend. Also, your insurance may not cover rental vans like U-Haul.
Can I Add a Temporary Driver to my Insurance?
The answer is definitely yes, providing there aren’t special conditions on your policy excluding certain drivers (say under the age of 25). You should be able to add or remove a driver from your insurance. In some cases, you may not even need to contact your insurer as most policies come with occasional driver coverage. For example, your friend can drive your car for couple of hours with your permission. Or your brother visiting you from out of town for a few days can use your car without the need to inform insurance company.
However, you probably have to inform your insurer and pay additional premium if an au pair moved in to look after your children for couple of months. Also, you may have to include your girlfriend/boyfriend in your policy if he/she is driving your car more often than occasional, regardless of him/her living with you.
Can You Make Temporary Adjustments to Vehicle Insurance?
At times, you may need to make special adjustments to your vehicle insurance policy. This may be possible to cover a special situation. For example, you may have just started a work and the company hasn’t allocated a company car for you yet. You may ask your insurer to cover driving your personal automobile for business for a short period until all sorted.
- Temporary Insurance for Own Vehicle
People may buy vehicles with intention of keeping for a short period and they need to be insured as long as they are kept. How to insure a temporary car depends on how long you want to keep and if you have a vehicle insurance policy already.
If you have insurance your new car is automatically insured for few days until you decide what to do next. A good example is that you just bought a new auto to replace your old car. You may need to insure two cars for a short time until you sell your old one. If it will happen in the next 3 – 4 days you may not have any problem. Otherwise, you should be allowed to add the new car on your policy until you find a solution and pay additional premium.
In any case, you will probably need to insure a new vehicle you bought before you can register it. If you don’t have any insurance to add the vehicle on, you may either look for non-standard short-term car insurance for it or buy standard auto insurance and cancel when you sell it. The best and cheapest transitory car insurance solution depends on how long you want to keep it.
- Temporary Automobile Insurance When You Don’t Have Insurance
You still have to make sure that the automobile you drive is insured when you don’t have any vehicle insurance policy to fall back to.
Temporary Insurance for Rental Cars
When you currently don’t have any vehicle insurance the easiest way of buying rental vehicle insurance is from the rental company. Otherwise, you may want to arrange non owners automobile insurance to cover the liability and buy additional Collision Damage Waiver (CDW), Loss Damage Waiver (LDW) or Towing Coverage from the rental company. Non-owners auto insurance would only make sense if you often rent cars.
Alternatively, you could check with your credit card provider as some credit card companies provide rental vehicle insurance coverage. Such coverage is usually secondary to any policy you may have or buy but it would be primary if you don’t have any insurance in place.
Can I insure a Car Registered to Someone Else?
Typically, registered keepers insure cars. If you want to drive someone else’s automobile you need to check if they have insurance to cover your driving. If the owner has insurance you should normally be covered by it, unless there are special restrictions on the policy preventing all or some occasional drivers. If you had your own policy it would have been a secondary policy for driving someone else’s car.
If there is no insurance on the vehicle you will probably have to persuade the owner to buy short-term car insurance to include you. It is usually either not possible or difficult to insure a car that is registered to someone else.
Short Term Auto Insurance for Registration Purposes
When you buy a new vehicle you need insurance to register it in most states. If you are thinking of buying short term insurance for a car you own and cancel it after registration you should think again. You are required to insure your automobile not just for registration purposes but as long as you own it. You should probably read our post titled; Do I Need Insurance for a Car I Don’t Drive before getting into trouble with DMV.
- Short Term Car Insurance on Vacation Homes
If you bought a car to drive in your vacation home and registered it in the vacation home state you will now need to insure it in that state. But this can be tricky and costly if you don’t do it right. These cars are driven only when you are there. But it may not be allowed or practical to insure them only when you drive, especially if family and friends use the home and vehicle as well.
One solution may be to insure it fully when you are driving and reducing coverage to fire and theft when you are back to your main residence. This may require you to fill off-road declaration with DMV each time and keep the vehicle in the garage. This brings us to the next solution that may work pretty well.
- Pay As You Go Policies As Temporary Vehicle Insurance Solution
Pay as you go auto insurance policies are priced based on your driving history and mileage and may be arranged on monthly payment bases. So, you would pay high premium when you drive a few thousand miles and very little when you don’t drive. This will eliminate the need to drop coverage when the vehicle isn’t used and increase when it is back on use since this is recorded by telematics in terms of mileage. Also, you won’t need to bother with DMV notifications.
It may be a perfect car insurance solution for vacation home autos. Furthermore, it is a good cheap automobile insurance solution for retired people with low mileage driving, people who are working from home or taking public transport to work, people with a second car, and high-risk drivers that have a point to prove.