Temporary and short-term car insurance. What are they? Who needs them? How do you go about getting coverage? We are going to answer those questions for you, so that you’ll know everything you need to know about this oft-neglected car insurance topic. Don’t worry, there’s nothing to be afraid of.
As you know, the average American buys a car insurance policy lasting between six and twelve months. Within a month of the policy’s expiration date, it can be renewed or allowed to lapse in favor of buying better or cheaper car insurance. However, there are times when a six or twelve-month policy is inappropriate.
Purpose of Temporary or Short-Term Insurance
Temporary and short-term car insurance are essentially the same, so we’ll refer to both of them simply as “temporary car insurance.” This type of insurance is designed for situations in which purchasing a six or twelve-month policy is not necessary. Here are a couple of examples:
- Loaner Car – You may find yourself without a car after an accident or major breakdown. Someone may loan you a car temporarily, until you get back on your feet. Temporary car insurance lets you cover that vehicle in the interim.
- Guest Drivers – Most insurance policies only cover guest drivers if those drivers are operating your vehicle on your behalf. So let’s say you have out-of-town guests who plan to stay with you for several months. If you give them full-time use of your car, they will probably need temporary car insurance to be covered.
- Military Service – There are times when military members are transferred to another state on a short-term basis. If their current car insurance companies do not offer insurance in that new state, a temporary policy may be in order until the individual returns home.
There are other reasons for getting temporary car insurance not listed here. However, the principle is the same. This type of car insurance is not intended to be used long-term.
Finding a Policy
Most of your major car insurance companies offer some sort of temporary car insurance. Regional or statewide companies may not. If you need temporary insurance, the first thing to do is contact your current provider to find out what they have to offer. Then be sure to get quotes from other insurance providers as well.
If you’re interested, there are specialist insurance companies that deal primarily in temporary insurance. While these companies may not have the big-name recognition of some of the well-known insurance giants, they provide adequate coverage on a temporary basis.
The one thing to remember is that you should always compare both rates and coverage amounts. Temporary car insurance is no different from your standard policy. You need to make sure you are getting enough coverage to protect yourself adequately, without paying an arm and a leg for it. You can only do that when you compare policies.
Things to Know
Despite all the similarities between standard car insurance and its temporary cousin, there are enough differences to make each one a distinctly separate product. As such, there are some important things you need to know:
- Most temporary car insurance is purchased in 30-day increments
- You’ll likely have to pay for the policy up front
- State laws limit the number of times a temporary policy can be extended
- You will not receive a refund for coverage that goes unused.
The terms and conditions surrounding temporary car insurance always favor the provider. As long as you do not mind that, it’s a great option when you don’t need a long-term policy.