Short-Term Car Insurance

Short-term car insurance is a flexible insurance option for drivers who need coverage for a limited time, usually ranging from a few days to a few months. This type of insurance is ideal for those who borrow or rent a vehicle. Or owning a seasonal car that isn’t used year-round. While most standard policies are for six or twelve months, short-term options cater to those who don’t want long-term commitments or only need coverage occasionally.

Short-Term Car Insurance

Some providers, like Hugo, offer on-demand insurance plans that allow you to purchase coverage for specific periods. From a few days to a month, and extend as needed. Though this insurance can be more expensive per day compared to long-term policies, It provides convenience and adaptability for drivers with temporary needs.

How Does It Work?

Most states require drivers to have auto insurance, even if they’re using a borrowed car. Sometimes, you might only need car insurance for a short period, like when borrowing a friend’s car for a couple of months.

Short-term car insurance usually offers only basic liability coverage, which pays for damage and injuries you cause to others. However, it doesn’t cover your injuries or damage to your car. Being uninsured can lead to costly bills for repairs, medical care, and legal fees.

Types of Short-Term Car Insurance Coverage

When is it needed? This policy can provide you with the needed coverage in the right situations. It is very important to check the requirements of any auto policy to know if it is best for your situation. Talking with an agent or insurer can help you clear up your confusion. Under different circumstances, specific types of short-term insurance can cover you when you need it, and the state requires

Non-owners insurance

Non-owner car insurance protects you when you’re driving a car that isn’t yours, like one you’ve borrowed from a friend. You can often buy this coverage for six or 12 months from major insurers. It typically costs less than standard coverage, and you can cancel it early to avoid paying for coverage you no longer need.

Rental Car Insurance

Before renting a car, see if your car insurance covers the rental. Most of the time, it does, so you may not need extra insurance. But there could be times when your policy doesn’t cover you, or it might only match the protection you have on your policy.

For example, if your policy lacks collision and comprehensive coverage, you probably won’t be protected against damage to the rental. In this case, you will need to purchase rental car insurance. However, some credit cards offer rental car insurance when you use the card to pay for your rental. Check your card’s benefits and how its coverage works to see if it suits your needs. Lastly, rental agencies offer their insurance options. This can include liability insurance and a loss-damage waiver to protect the rental car.

International car insurance

If you’re planning to drive internationally, you might need international short-term car insurance. “International” could include driving in Canada and Mexico. Many insurance companies extend your policy to cover driving in Canada, but this is often not the case in Mexico.

If you’re heading to Mexico, contact your insurer to see if they partner with a company that offers car insurance there. Some companies specialize in providing insurance to travelers driving in Europe or other countries. However, for short trips, the simplest option for short-term rental car insurance is often through a car rental agency.

Pay-per-mile coverage

Though not short-term insurance, you might look into pay-per-mile coverage, also called pay-as-you-go or usage-based coverage. It’s a budget-friendly choice if you don’t drive much. This option calculates your premium based on how you drive, tracked by an app, rather than how the insurer assumes you drive. Some companies specialize in pay-per-mile coverage, while others offer usage-based discount programs.

How Much Does it Cost?

This policy usually costs more than a six-month or yearly policy. Temporary policies can cost up to $200 a month and often have a 30-day minimum, even if you only need coverage for a short time.

Data from 2018 by the National Association of Insurance Commissioners shows the average monthly cost for a policy with liability, comprehensive, and collision coverage was $99.17. Besides your state of residence, factors that influence car insurance rates include:

  • Age
  • Gender
  • Driving history
  • Experience behind the wheel
  • Claim history

In states where it’s permitted, insurers may look at your credit-based insurance score when you apply for coverage. This score is usually derived from your credit report from Experian, TransUnion, or Equifax.

Where can I purchase Short-Term Car Insurance?

This auto policy can be hard to find. Although most insurers don’t advertise one-month policies on their websites, some do offer them. We have discovered that these companies have filed with state insurance departments to provide one-month policies:

  • American Hallmark Insurance Co. of Texas (available only as renewal policies)
  • Apollo Insurance
  • Fairyland (available only as renewal policies)
  • Direct General
  • First Chicago Insurance Co.
  • National Unity Insurance Co.
  • Old American County Mutual Fire Insurance Co.
  • Young America Insurance Co.

Hugo is another option, providing on-demand car insurance with plans that let you buy coverage for three, seven, 14, or 30 days and extend as needed. You will be required to provide certain information about yourself to purchase this policy.

Should I get Short-Term Car Insurance?

Only you can tell if short-term car insurance is the right choice for you based on your situation. If you opt for a short-term policy, make sure you pick a reputable company offering enough coverage to meet your needs.

You might be able to get temporary car insurance by adjusting your current policy instead of going with a separate short-term plan. There’s no universal solution for this policy. If you’re unsure, chat with an insurance agent about your situation and the available options.