Insurance coverage, including car insurance, can feel confusing. There are a lot of terms to know and things to understand and compare before you purchase a car insurance policy. Sometimes, you might not need a traditional policy, either.
For example, maybe you need short-term insurance, and you’re wondering if that’s even an option. You might question if short-term insurance could mean a day or 12-month car insurance—it really just depends on the situation.
For the most part, if you’re up to 12 months, it’s not considered short-term insurance, because that is the standard time a company writes a policy for, but for shorter times than that, an insurance company might consider it short-term.
Sometimes insurance companies will offer terms of six months, but anything shorter is going to be tough to find barring a few situations. It’s in the best interest of an insurance company to have clients for as long as they can, which is why they’re super enthusiastic about short-term policies.
There are administrative costs that come with initiating an insurance policy, so they might not be worth it in this sense to the insurance company.
Also, if you’re seeking short-term insurance, the company may see you as high-risk.
If you have short-term insurance rather than continuous longer-term standard coverage, you may also have gaps in coverage that can be a red flag to future insurers.
Some of the reasons someone might want short-term or temporary car insurance include visiting somewhere on vacation, using a ride-sharing service when you’re driving but don’t own the car, being in-between cars, or to supplement their current liability insurance with something else.
Other situations might be renting a car, borrowing a car for an extended period of time, or someone who is buying a car only for a short time and planning to sell it rather quickly.
Regardless of the specifics of your situation, the following are some things to know about whether or not you can get short-term or temporary car insurance.
Decide What You Actually Need
As mentioned, auto insurance can be confusing, so before you start buying anything, contact your last car insurance company or your current home insurance company. Ask them what coverage you had or currently have through them.
If you have no coverage through either, you can speak to an insurance representative who can help you figure out exactly what you might need.
If you’re going to be driving someone else’s car, don’t assume you need temporary insurance.
It may be that you could be covered under their policy, but you need to confirm this.
If you don’t own a car, you might be able to buy a non-owner liability policy, but it’s not the only way to cover yourself in the short-term. Additionally, there can be risks to these including the fact that they don’t cover damage done to the vehicle itself.
Be Cautious If You’re Renting a Car
If you’re renting a car but you also drive a car elsewhere, it’s very likely you don’t need temporary insurance.
You may have coverage from different sources. Your car insurance may extend to your rental, and your credit card company may also offer additional insurance on rental cars.
Always verify this with your car insurance company.
What Is a Non-Owner Liability Policy?
The concept of a non-owner liability policy was touched on above, and essentially these are temporary policies intended to cover very specific situations, and they do have exclusions when it comes to the type of car that can be insured with them.
Non-Owned liabilities are often covered by big-name insurance companies.
Another type of insurance that could, in some cases be considered short-term or at least outside of the realm of a typical policy is one that’s usage-based or pay-per-mile.
With usage-based car insurance, your premiums are based on how you’re driving, rather than looking at statistics to show how people similar to you drive.
If you don’t drive very much, this can save you a lot of money.
Finally, some people who only want car insurance for a short period of time will cancel it before the end date of their policy. This isn’t advisable.
This can be illegal in some cases, and you could also see much higher rates when you then go to purchase insurance again.
If you do cancel you can receive a refund for the months you didn’t use, but again, this typically isn’t a good option.