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Short-term Car Insurance: Everything You Need to Know About Temporary Coverage

Do you need car insurance, but only for a short span of time? Maybe you are renting a car, or borrowing one from a friend, or just need some supplemental coverage for a road trip. If so, you may be wondering what short-term car insurance is, and whether it’s right for you.

Spoiler alert: short-term car insurance (less than 6 months) is extremely hard to find in the U.S.

Here’s what you need to know, including several alternatives that might suit you better.

What is short-term car insurance?

Short-term car insurance, also known as temporary car insurance, is a car insurance policy that offers vehicle coverage for as little as one day or as many as 28.

Standard car insurance policies usually last for 12 months. In some cases, you may be able to get a 6-month policy. Either way, sometimes, that’s more than you need. This is where short-term car insurance comes in.

Temporary car insurance policies are similar to standard car insurance policies, with coverage options including:

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

Coverage limits range from your state’s minimum insurance requirements up to higher limits for higher costs. You can choose the types and amounts of coverage that best suit your situation.

Why might you need short-term car insurance?

Short-term car insurance comes in handy when you need some coverage, but don’t need it for the full term of a standard policy. For example, if you:

  • Buy a car that you’ll only have for a short period of time before reselling it.
  • Visit another country on vacation for a short period and buy a temporary car to drive while you are there.
  • Plan to borrow a car from someone on a regular basis.
  • Drive a rental car on and off for a few months and want to pay less than you would for insurance through the rental company.
  • Drive for a ride-sharing service in a vehicle that is not yours.
  • Are the parent of a young driver who uses your car occasionally to practice.
  • Want additional supplemental coverage for a road trip.
  • Are between annual insurance policies.
  • Are putting a car in storage.

On the flip side, you wouldn’t need short-term car insurance if:

  • You borrow a car on an occasional basis, as the car owner’s insurance would likely cover you (but you should always check!).
  • You rent a car and already have coverage through your credit card benefits or through the rental company.

In short, if you’re driving a vehicle for a short time and don’t have coverage elsewhere, a short-term policy may be helpful.

Cost of short-term insurance

The cost of your short-term policy depends on several factors, including the length of the policy, your chosen coverage types, your vehicle, and your personal insurance history

Additionally, where you buy the coverage strongly affects its price. For example, temporary insurance from a rental car company often costs much more than policies from insurance companies. Further, costs vary from one insurance company to the next. As such, you should shop around before making your purchase.

Where can I find short-term car insurance?

Unfortunately, short-term insurance isn’t widely offered in the United States. It is much more common in the U.K. However, you may find a few specialty insurance companies offering this coverage.

The problem is, these offerings may not always be 100% legitimate. And they can be hard to find. Some large insurers that offer short-term plans don’t advertise them, since they are not as profitable as the six to 12-month renewable policies.

So if you can’t find short-term car insurance, what should you do instead?

5 alternatives to short-term car insurance

There are a few alternatives to short-term policies that offer similar benefits but are easier to find.

1. Early exit from a standard auto insurance policy

You can sign up for a six or 12-month policy which doesn’t have a cancellation fee and lets you pay monthly. Then, when you no longer need coverage, just cancel the policy. Your insurer will refund the amount of your premium that you didn’t use.

Browse auto insurance options here to find one that suits your needs:

2. Named non-owner auto insurance

Named non-owner auto insurance policies are another more commonly available solution if you need liability insurance while driving a car you do not own.

Leading auto insurers like USAA and Liberty Mutual offer these policies, though they do not advertise them widely. You’ll likely have to call or visit an agent to learn the details.

However, the policy usually doesn’t include comprehensive or collision coverage. It offers the required coverage types in your state, and may also allow you to add medical payments and uninsured/underinsured motorist protection. If you need more comprehensive coverage, you should seek out another option.

3. Usage-based car insurance

Usage-based car insurance is also called pay-per-mile, pay-as-you-go, or telematics car insurance. It involves the insurance company using a device that is installed in your car to record your driving behavior. You can earn a cheaper rate by practicing safe driving habits. Big name insurers including Progressive, Allstate, and Esurance offer these usage-based policy options.

4. Rental car insurance

If you are renting a car, consider the insurance provided by the rental company or insurance through a credit card provider. Many credit cards, like the Deserve Classic Mastercard and Milestone Gold Mastercard include rental car coverage in their benefits.

Review and compare credit cards.

5. Car owner’s insurance

If you are borrowing a car, check with the car’s owner to find out if their insurance covers other drivers. It may provide the coverage you need.

While short-term insurance is an option, it can be extremely hard to find. Luckily, these other options are easier to access.

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