Temporary Car Insurance: What Are the Options?

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Need car insurance for a car you will only be driving for a short term? You may have more than a few options to insure the car. Some people may consider temporary car insurance, but getting the insurance coverage you need may not require a separate policy from your own car. Here's what you need to know.

What Is Temporary Car Insurance?

Temporary car insurance policies or short-term car insurance is for when you will only require insurance on a car for a short period of time, such as less than six months, due to a variety of circumstances.

Insurance companies, in general, tend to write standard car insurance policies that usually last for a term of six months to one year. They are not usually in the business of writing insurance for short terms like a few days, so people often look for other options, though it may not be easy to find in the U.S. However, there are ways to ensure you're covered.

Who Might Want Temporary Car Insurance?

There are several reasons why you might need or want a temporary policy. Common scenarios include when someone buys a new car but only intends to own it for a short period of time, or when someone needs coverage now so they can take their time shopping for a permanent insurance policy.

If you're borrowing a friend's car for an afternoon, you probably don't need your own policy, but you may need to seek out coverage if you're borrowing the car for several days or weeks. Similarly, if you're renting a car from a rental dealership, you may want to seek out a short-term insurance policy.

People who visit another country and bring their car with them, but only for the short term, may also look into temporary car insurance. For example, if you were to drive to Mexico and spend a few weeks in the country, you could get temporary car insurance to cover you there.

Other instances where you may want temporary car insurance include:

  • When you're in-between cars
  • When you're concerned about the liability limits on the car you're borrowing and you want to supplement it with additional insurance
  • When you will rent a car that you do not own
  • Borrowing a car from a friend or family member for an extended period of time
  • Driving rental cars on and off on several occasions or for a few months, and you want to use temporary car insurance to avoid high rental company insurance fees, and you do not have your own permanent car insurance
  • Using ride-sharing, or if you do not own the car but will be driving frequently
  • Buying a car for a short period and then planning to resell it

If you plan to buy a car but then sell it shortly after, contact your own insurance company because you may be able to add this new temporary car to an existing policy instead of taking out a separate policy. This may save you money because you will get a multi-car discount while you insure your second car, and you may not even have a penalty when you delete the car because you aren't canceling the policy, you are just deleting a car.

Before Buying Temporary Car Insurance

People are often confused by the coverage that different car insurance policies provide, and depending on your circumstances you may not need temporary car insurance.

Before you decide you need to buy a supplemental liability policy or car insurance policy for temporary reasons, contact your last car insurance company, your current home insurance company, or a licensed insurance representative and explain your circumstance to them. They may surprise you by letting you know you actually have coverage already, or they may be able to give you a suggestion for how to get temporary insurance. 

If you currently have insurance on another vehicle, check your policy or call your agent before buying a new car. Your carrier may automatically cover the new vehicle for a brief period.

You can also look into purchasing an insurance policy with a shorter term, for example, a six-month policy. 

Another option is to speak to the owner of the car you will be using (if it is not you) and have them ask their own insurance company if your use of their car is covered. You may not have to purchase any coverage if their policy will cover you.

And if you're renting a car, check your credit card agreement. Some credit cards automatically cover your rental vehicle if you pay for the rental with that particular card.

Non-owner liability policies are possible to purchase for temporary insurance situations when you do not own a car, however, this may not be your only option which is why it is a good idea to speak to an insurance professional to get the best advice. Non-owner liability policies also do not cover the physical damage to the car, so be sure to see what coverages you need and want when you look for temporary automobile insurance.

Does Your Personal Car Insurance Cover a Temporary Car?

Your car insurance policy may cover rental cars. If it does, you may not need to buy any temporary car insurance through a rental agency.

The coverage will generally reflect the same coverages you have on your own car. For example, if you have a $500 deductible on comprehensive coverage, this same coverage and deductible would extend to your rental car. Whatever deductibles and coverage limits you have on your own car would extend to the rental car.

However, sometimes your personal car insurance policy does not extend to business rented or business use cars. Check with your car insurance company to confirm you have the proper coverage before renting the car. They will be in the best position to help you and offer appropriate coverages for your situation.

Non-Owner Liability Policies

Non-owner liability policies are meant to cover specific circumstances and do have some exclusions on the definition of a car that may be insured under the policy.

You can do a search online to find a good rate on a non-owner liability policy. Many of the mainstream insurance companies do offer non-owner liability policies, so it really is a good idea to start with your own insurance company. It may be able to save you some money by helping you make sure you are not doubling up on your coverage unnecessarily.

What's Covered by Temporary Car Insurance?

Depending on the kind of temporary insurance you decide to purchase, you will have different coverage options. Inquire about the following basic car insurance coverages to best understand the policy before you buy it:

  • Liability
  • Comprehensive coverage
  • Collision coverage
  • Uninsured and underinsured motorists
  • Medical payments
  • Towing
  • Loss of use

Will Home Insurance Cover Temporary Car Insurance?

Home insurance does not cover temporary car insurance. In general, the liability of a home insurance policy excludes liability for automobiles.

Some excess liability policies may offer coverage for uninsured or underinsured motorists protection. One example is Chubb, which specializes in high-value home insurance.

What About Personal Effects in a Car? 

Rental agencies sometimes ask if you would like to purchase personal effects insurance.

If you lose items in a car during a car claim, then your personal belongings may be covered under your homeowner insurance policy or renters policy. Items that are not attached to the car or a part of the vehicle itself are not covered under car insurance. With personal effects coverage from a rental car agency, these may also be covered, though you should check your homeowner's policy first before buying an additional policy since you may already be covered.

If you claim personal property on a homeowners or renters policy, note that your claim would likely be subject to a deductible and may also have consequences like losing your loss-free discount.

How Much Does Temporary Car Insurance Cost?

As mentioned earlier, temporary car insurance is not generally available in the U.S. since many car insurance companies only sell policies of six months or 12 months. If you're able to find a temporary policy for what you need, the price will likely depend on what kind of car you are insuring, how you will be using it, your personal insurance history, and the length of time you require short-term or temporary insurance.

Depending on where you buy the temporary insurance, the cost will vary greatly. For example, you may be able to buy temporary car insurance when you rent a car from a rental agency, but it could be expensive. Shop around and see what coverage you can get from your own insurance company before making any decisions about short-term car insurance.