CarInsurance.com Insights
- Temporary car insurance doesn’t exist. If you want to opt for a shorter-term policy, buy a six-month policy.
- Most car insurance policies extend coverage to any driver permitted to operate your vehicle (a permissive driver).
- The policyholder can cancel a car insurance policy at any time.
You can’t buy temporary car insurance as a separate product. Most insurers in the U.S. only offer policies that last six or twelve months. If you need coverage for a shorter time, you have two main choices: buy a six-month policy and cancel it early, or, if you don’t own the car, get a non-owner policy.
What is temporary car insurance?
There is no separate product called temporary car insurance. If you want a shorter commitment than the usual term, you can choose a six-month policy instead of a year. You are free to cancel it whenever you no longer need coverage. If you do not own a car, a non-owner policy can provide the coverage you need.
Short-term car insurance, also known as temporary car insurance, is a product for when you do not need the typical six-month term and often when you are insuring a car you do not own, according to James Brau, Joel C. Peterson Professor of Finance at Brigham Young University.
“You can get insurance for as little as one day – such as when you are renting a car,” he says. “You can always cancel a six-month policy if you want to engineer your own short-term insurance, although there may be additional fees.”
Getting your first policy? You’re not locked in for a year
If you’re buying insurance for the first time on your own, a yearlong commitment may feel daunting. Whether you’re purchasing your first vehicle or leaving a parent’s policy, a six-month term can provide flexibility while you figure out your long-term plans.
You’re covered immediately, and if your plans change after six months, you can look for a new policy or cancel early. Most insurers will refund the unused part, sometimes with a small fee.
If you don’t own a car but regularly borrow friends’ or family members’ vehicles, a non-owner policy can provide liability coverage when you’re behind the wheel. It also helps maintain continuous insurance coverage, which insurers often reward with lower rates.
Whether you choose a six-month policy or a non-owner policy, you’re making a practical decision based on your current needs.
Sophie’s Tip
If you own a car, a six-month policy is usually a good option. If you don’t own a vehicle yet, a non-owner policy can keep you covered and help maintain your insurance history.
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Who needs temporary car insurance?
Short-term insurance can seem like a good option if you only need coverage for a few weeks or months. Many students, seasonal drivers and travelers search for it, but it is usually not offered in the U.S.
However, you might not need a separate policy. Most insurance companies cover occasional drivers as long as they have the owner’s permission to use the car. So, if someone borrows your car for a short time, your policy may already protect them.
Do household members need temporary car insurance?
If your child has a learner’s permit, they may already be covered or can be added easily as a driver. Ask your insurer to find out what applies to your policy.
Most of the time, everyone in your household needs to be listed on your policy. If your college student lives away from home, you still need to include them, but you can often get a discount if they live at least 100 miles away.
What are the risks and limitations of short-term car insurance?
The risks and limitations of your insurance policy apply as they would with a standard policy. Your car insurance policy only covers you up to your selected coverage limits. And comprehensive and collision coverages come with deductibles, which you’ll have to pay if you file a claim.
What is the shortest term for car insurance?
The shortest term for a standard car insurance policy is six months. Very few insurers offer short-term policies. Instead, you must obtain a regular policy and then cancel it when you no longer need it. You might have to pay a cancellation fee when you cancel your policy.
It can be tricky, so knowing what steps to take is wise. In some cases, you may not even need temporary car insurance.
Do you need a short-term policy if you buy a car out of state?
Don’t bother with looking for temporary insurance. Instead, call your current auto insurer before you pick up the car. You’ll likely find that you have automatic coverage for the vehicle for anywhere from seven to 30 days.
It will depend upon your state laws and your insurer’s guidelines. If you’re replacing another car already on your policy, the car is more likely to be automatically covered than if you add another vehicle to your household.
If you’re not automatically covered or will be out of state longer than the automatic coverage lasts, ask your insurer what it will take to add the car once you have it. You might need to provide a bill of sale and vehicle identification number (VIN) to start coverage on a newly purchased vehicle.
Get quotes for car insurance before you buy a policy
If you don’t have a car insurance policy, shop around before picking up the car. You can select the policy you want and be ready to start it once you have the VIN.
But if you’re already out of state when you realize you need car insurance and don’t have it, you can buy a policy on the road. Purchasing a six-month policy will give you coverage to get you home.
Once you are home, take the time to shop for car insurance — compare options and find the best rates possible. You can switch companies if the cheapest rates are with a different insurer.
Also, remember that driving a car home you purchased out of state may require obtaining an interstate in-transit permit (registration) in the state where you bought the car.
It pays to do your homework before buying a car out of state so you can afford your insurance and registration for the drive home.
What kind of coverage do you need for a seasonal-use vehicle?
Your commuter car needs year-round coverage, but if you have a vehicle you drive only occasionally or seasonally, you may want a shorter insurance policy. The first step is to contact your current car insurance company to see what it recommends.
Your insurer will likely allow you to add the car to your policy when needed and remove it when it’s stored. This means adding it, being charged for the times you drive it, and canceling coverage when it is not in use.
If your insurer doesn’t offer this, shop around for one that does. Having one auto insurance provider for all your vehicles is more straightforward, but you must also do what makes the most sense for your needs.
What happens if you’re storing your vehicle?
A complication of this part-time insurance scenario is that if you take liability car insurance coverage off your stored vehicle to save, most state laws require you to turn in your plates and registration. Re-register and tag your car when you’re ready to drive it again. If you fail to insure a registered vehicle, you may be penalized by the state.
If you remove liability coverage from a stored vehicle, it’s a smart move to keep comprehensive coverage on it. Generally, this is relatively cheap and will protect your car if it’s stolen, vandalized, or damaged by an act of nature, such as a tornado. Many insurance companies offer this as an “in storage” policy.
Contact your insurer if you plan to take your car out of state for a few months
If you stay at an out-of-state home for an extended time during the summer or a college-age kid takes a household vehicle for a month internship out-of-state, you don’t need to search for short-term insurance. Instead, study your current policy and contact your insurer with issues or questions.
Most standard car insurance policies have a broadening clause that extends coverage to other states. This means that if the state minimum car insurance requirements in a state you are traveling to or staying in are higher than those in your home state, your insurance will automatically increase.
Not all policies have this quality, so if you find yours does not, consider bumping up your limits before you go if the state you’re staying in has higher limits than you currently have.
Your insurer doesn’t mind you temporarily staying in another state, but if you decide to make it permanent or long-term (your son’s internship turns into a job), then you’ll have to change your insurance to that state.
Most states also require that you register and insure a car if you remain there long enough. For instance, if your vehicle is in Florida for 90 days or more in a year, even if nonconsecutive, you must secure Florida insurance for your car.
Frequently Asked Questions
Do you need a policy if you rent a U-Haul?
Yes. While your personal auto insurance policy coverages – and even credit card insurance benefits – typically extend to rental cars (so you don’t need to buy temporary insurance for a rental car if you book the entire rental on that card), they don’t cover commercial vehicles or rented trucks, such as a U-Haul moving truck.
Moving truck rental companies declare the truck renter fully responsible for the equipment and any damages. You’ll be charged for the repair costs and loss of income while the truck is out of service.
A moving truck rental agreement usually includes state-required minimum liability coverages, but that’s it. Additional coverage – such as a damage waiver, cargo coverage, personal accident insurance, supplemental liability coverage and towing insurance – is recommended.
Why do most insurers not offer daily, weekly or monthly policies?
Short-term insurance customers are less likely to renew, so they’re less valuable to insurance companies. The administrative costs of a very short-term policy wouldn’t justify the premiums the customer pays.
How can I cancel my short-term car insurance policy?
To cancel your car insurance policy, contact your insurance company by phone and speak to a representative. Cancellation fees may apply.
The bottom line
You can’t get a one-month car insurance policy in the U.S., but you still have choices. If you own a car and only need insurance for a short time, a six-month policy that you cancel early is often the easiest option. In case you don’t own a car but sometimes drive borrowed vehicles, a non-owner policy could give you the liability coverage you need. Before you look for temporary insurance, see if a family member’s policy already covers you.
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