Temporary Auto Insurance and Situations to Use It

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Leslie Kasperowicz
14 Years in the Insurance Industry (CSR & Writer)https://res.cloudinary.com/quotellc/image/upload/insurance-site-images/4autoins-live/6ea5d860-leslie-kasperowicz.jpg

UPDATED: Mar 13, 2020

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Last Updated: January 24, 2019

When it comes to auto insurance, temporary car insurance may be the right choice for you depending on your unique needs. Today, we’re explaining everything you need to know about temporary auto insurance and the situations where you may want to use temporary auto insurance.

temporary auto insurance

What is Temporary Auto Insurance?

First, let’s clarify what temporary auto insurance is and how it works.

Most car insurance works on a long-term basis: you buy car insurance for a 6-month or 12-month term, and your car insurance is automatically renewed for the lifetime of your vehicle. This is ordinary car insurance.

Temporary car insurance works in a different way. Temporary car insurance may be purchased for a single day, a week, or a month.

Let’s say you’re renting a moving truck from U-Haul for the day. You might buy temporary car insurance to cover the rental van.

Or, if you’re buying a new vehicle from a car dealership, the dealership may require you to buy a temporary auto insurance policy before driving it off the lot.

Alternatively, you might buy temporary car insurance if you’re only in a location for two or three months. Let’s say you’re flying to Hawaii for work on a 2 or 3-month contract. Rental car insurance can get messy when renting for periods beyond 30 days. Meanwhile, traditional car insurance providers may require a 6-month or 12-month commitment. You might need special temporary car insurance.

Some people also buy temporary car insurance if they’re away for a long vacation. You might be a snowbird flying south for the winter, for example. You buy temporary car insurance to cover your car up north during the summer months.

There are all sorts of reasons to buy temporary car insurance. Let’s take a closer look at how it’s used and how it works.

How is Temporary Car Insurance Used?

Temporary car insurance is typically used when purchasing a vehicle from somewhere other than the dealership. That location may have its own auto insurance partners. You need to buy temporary car insurance to protect your car on the drive from the dealership to your home. The car dealership allows you to buy temporary car insurance that covers you for the day or the week.

Once your car is safe at home in your garage, you can buy a full-term auto insurance policy. You can compare quotes online as you normally would. Your temporary car insurance expires, and your full-term car insurance begins.

In other situations, you might buy temporary car insurance when lending a vehicle to someone else. You might trust your own driving skills but are less certain about someone else’s driving ability. In this situation, you may wish to buy temporary car insurance during the day on which you plan to lend the vehicle to a friend. You might add supplemental insurance – like higher coverage limits – when lending your vehicle, for example. Or, you could buy an entirely new policy to cover the borrowing period.

Others use temporary insurance when moving RVs, motorcycles, sports cars, or another type of vehicle only driven at certain times of the year. You might have purchased an RV in another state, for example, and are planning to drive it home. You buy temporary insurance to cover the RV while you get it to its final destination. Snowbirds may use a similar strategy when relocating from south to north and vice versa.

Finally, some people use temporary car insurance if they simply cannot afford to buy a 6-month or 12-month insurance policy at this time. If you cannot afford a long-term insurance policy and don’t have enough credit to set up a monthly payment plan with your insurer, then you may need to buy temporary car insurance.

Do I Need Temporary Car Insurance?

Some of the most common reasons to buy temporary car insurance include:

  • You are in between car insurance policies, but you still need to drive
  • You are insuring a rental car or another vehicle for a cross-country road trip; say, when relocating to a new state or driving south for the winter
  • Friends, relatives, or house guests are renting your vehicle for a brief period of time
  • You only have possession of the vehicle temporarily
  • You are leaving your car in storage but still want some level of insurance on the vehicle
  • You are preparing to sell a vehicle; you want to temporarily insure it to move it around or show it to potential buyers
  • A university student is home for a break and needs to drive the vehicle for a brief period of time
  • You just purchased a vehicle from a car dealership and need temporary car insurance to drive it home

Do You Need Temporary Car Insurance?

In some of the situations above, you may not need to buy temporary car insurance at all. Your car insurance might provide adequate coverage.

When lending your car to someone else, for example, your car insurance should remain active. As long as the other individual has permission to drive your vehicle, your car insurance follows the vehicle.

Meanwhile, when renting a car, your credit card company might extend coverage. As long as you buy the rental car using your credit card, and your credit card has rental car coverage, then you may not need to buy temporary car insurance for your rental car.

We recommend reading your car insurance policy or contacting your insurance agent to determine if you need temporary coverage.

Some dealerships, for example, won’t allow you to drive off the lot unless you buy temporary car insurance or have concrete proof that your insurance extends to newly-purchased vehicles. Meanwhile, your credit card’s rental car insurance coverage may not cover non-standard vehicles: it would cover an economy vehicle but not a moving truck, for example.

What Else Do I Need to Know About Short Term Car Insurance?

Short-term car insurance may be the right choice for you. Other things you need to know about temporary auto insurance include:

  • Typically, a temporary auto insurance policy is taken out for a period of 1 to 28 days. If you are planning to have insurance for more than, say, 1 month, then you may want to find a month-to-month car insurance policy
  • Alternatively, many temporary auto insurance companies allow you to extend your coverage beyond the 28-day limit
  • Avoid buying low coverage limits on your temporary car insurance coverage if driving a high-end vehicle; many people buy the cheapest possible temporary coverage, only to get into an accident and find the insurance barely covers any of the costs
  • Make sure you understand the temporary auto insurance coverage; some temporary car insurance policies have many exclusions that make it difficult to make a claim
  • Check your temporary car insurance policy to verify it has coverage for “Acts of God”, for example; some temporary car insurance policies will not pay out a claim if your car was damaged during a storm, a hurricane, or a similar “Act of God” scenario
  • Verify whether the temporary car insurance provides just basic liability coverage or if it’s a full coverage policy; a full coverage policy would include coverage for theft, vandalism, and environmental damage, while a basic liability policy may only include coverage for collisions with other vehicles

How to Find Cheap Temporary Auto Insurance

Many of America’s leading car insurance companies also provide temporary auto insurance. Other companies specialize in providing short-term auto insurance.

Compare quotes online today to ensure you find the best temporary auto insurance for your unique needs. Or, speak with an auto insurance agent to explore temporary auto insurance plans.

Alternatively, you might already have automatic temporary car insurance through your existing policy, your credit card company, or your rental car company. Make sure you’re not over-insuring yourself and paying for car insurance that you don’t need.

Compare temporary car insurance quotes online to find the right policy for you. Just enter your ZIP code in our online form to get started.

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