What Is Short-Term Car Insurance And Should I Get It?

Most people buy a car insurance policy that lasts six months or a year. But in some cases, you might need coverage for a much shorter period. A short-term car insurance policy may be the solution you’re looking for—or you may find a traditional six-month policy that you cancel early works best.

What Is Short-Term Car Insurance?

An auto insurance policy in effect for less than the standard six months can be considered short-term car insurance, such as a policy lasting only a month.

Drivers typically buy short-term car insurance policies covering 30 days or less when they need coverage for only a limited amount of time, says Mark Friedlander, a spokesperson for the industry-backed Insurance Information Institute.

Major car insurance companies typically do not offer short-term insurance coverage. You may be able to find one from a smaller company. For this reason, if you decide short-term car insurance is right for you, it is crucial to verify you’re purchasing a policy from a reputable company.

Why Would You Buy Short-Term Car Insurance?

Trusted Choice, a network of independent insurance agents, says car owners might buy short-term car insurance for reasons such as:

• You’re in the process of switching longtime coverage from one insurer to another, and you’ve already dropped your previous coverage.
• You’re temporarily lending your car to a relative, friend or someone else who will be excluded from your regular auto insurance policy. The short-term coverage applies to your vehicle while it’s being driven by a relative, friend or someone else.
• You’re selling your car and need to cover the vehicle when it’s being driven by potential buyers who won’t be covered by your regular policy.

It’s possible that your standard car insurance policy can be adjusted to cover your needs and you won’t have to search for temporary coverage.

There are several situations where you might consider short-term car insurance coverage, including the following scenarios, though the alternative methods we mention may work better for your needs.

Temporary Coverage for Student Drivers

If your child is a student away at school that goes long periods without a need for a car, they may only need a temporary or short-term car insurance policy for the times they are home. You can look for a policy that covers a week or month for your student—however, other options that may work better.

One option is to add your student to your car insurance policy during the periods they are home—such as summer break—and take them off while they’re away at school. Another option is to continually keep your child on your policy and ask your insurer about teen car insurance and discounts for students.

Many insurers offer a “student away” discount if your child attends school full-time a specified distance away from the home, typically more than 100 miles, and doesn’t have a car at school with them. This option ensures your child is still a covered driver without you paying full price for that coverage.

Check with your car insurance company about your options. Some insurers, like Progressive, require college students who are away at college but occasionally drive their parents’ cars to remain on the parents’ auto insurance policy.

Someone Temporarily Uses Your Car Insurance

Does your roommate, babysitter or friend need to borrow your car for a day or on a regular basis? The driver may look for a short-term policy to cover driving your car, but there is likely an easier way to have them covered.

If a friend uses your car infrequently, under most car insurance policies they would be provided coverage under your car insurance policy as a permissive user. A permissive user is someone you give permission to use your car.

If the person lives with you or is going to drive your car on a regular basis, you can add them to your policy. In fact, most car insurance companies require that you add any frequent driver of your car to your policy. Examples of people you might want (or need) to add to your policy include:

• Roommates
• A spouse or significant other
• A teen driver or college-age student
• A friend who regularly drives the car
• A babysitter who uses your car frequently

The cost of adding someone to your policy will vary depending on a number of factors, including the driver’s age and driving history. Inexperienced drivers and those with a track record of accidents and infractions will cost more to add normally.

If things change and the person is no longer driving your car regularly, you can always remove them from your policy.

Temporary Car Insurance for Rental Cars

Before renting a car, you should check if your car insurance will cover the rental car. In many cases, the answer will be “yes.” You likely won’t need additional or short-term insurance when this is the case.

However, there may be situations where your policy does not cover you. Also, even if your policy gives you rental car insurance coverage, it usually only extends the same protection your personal policy offers.

For instance, if you don’t carry collision and comprehensive coverage on your personal policy, you normally won’t be protected from any damages to the rental.

Some credit cards also offer rental car protection when you use the card to reserve and pay for your rental. Check if your credit card covers rental cars and find out the details of how any coverage works to determine if it meets your needs.

Finally, you also can purchase rental car insurance from the agency that rents you the car. This short-term car insurance may be some combination of liability insurance and what is known as a loss damage waiver that covers damage to the rental car.

Short-Term International Car Insurance

If you plan to drive internationally, you may need some type of international short-term car insurance.

Remember, “international” may also include time spent on the roads of Canada and Mexico. Although many insurance companies will extend the coverage on your personal policy to your time driving in Canada, that usually is not the case in Mexico.

If you plan to drive south of the border, contact your insurer and see if it partners with a company where you can buy car insurance for Mexico.

There are companies that specialize in providing insurance to travelers who plan to drive in Europe or other international countries. However, if you only plan to travel for a relatively short period, the easiest way to get short-term rental car insurance is through a car rental agency.

Placing a Car in Storage

A car placed in storage may not require insurance so long as you don’t drive it, but depending on state laws, you may need to cancel your registration and turn in your plates if you drop insurance. Also, you won’t have coverage if your car is damaged while in storage.

Instead of finding a short-term policy for storage, talk to your insurer about retaining a standard policy that is pared down. For instance, with Allstate, if your car is in storage for 30 days or more, you can suspend your liability and collision coverage and have comprehensive-only coverage.

Comprehensive coverage is good for a stored car because it pays for damages from certain situations—such as if something falls on your vehicle, fire or smoke damage or the theft of your car—and the cost will be much lower than if you maintained full coverage car insurance.

Other Circumstances

There are a host of other situations where you may wonder if you need short-term car insurance. These can include:

• The day you take your driving test.
• When you buy a new car.
• If you start working as a rideshare driver.

It is usually easy to ensure you have coverage in these situations. For example, new drivers taking a test are typically covered under a parent’s insurance policy or the car owner’s policy.

And car insurance for a new car is typically extended from your existing policy for a short period when you buy an additional car. If you don’t have insurance already when you buy a new car, it’s wise to buy standard car insurance for the new vehicle instead of buying temporary or short-term coverage.

If you work as a rideshare driver, some car insurance companies offer rideshare insurance that acts as a form of short-term coverage. It provides coverage when the app is on and you’re waiting for a ride request before the more robust insurance from the rideshare company, such as Uber or Lyft, takes over once you accept a ride.

When in doubt if you need short-term insurance, contact an insurance agent to discuss the best policy for your particular situation.

Temporary Car Insurance and Military Deployments

Military members may be looking for temporary car insurance between deployments. In this case, a standard auto insurance policy may be a better fit. Short-term policies are hard to find, so seeking an traditional auto insurer may be better. For example, USAA auto insurance is available exclusively to military members (and their families) and the company understands the unique needs of military members.

Canceling a Short-Term Policy During Deployment

Whether you find a short-term policy or have a standard policy for your vehicle, you might be considering canceling your policy when you’re deployed. This is usually not a good idea, as you’ll have no coverage whatsoever on your vehicle and a gap in car insurance coverage, which leads to more expensive costs when you buy insurance again later

If your vehicle will be driven while you’re away, car insurance should remain on it to cover the driver who is operating it. If the vehicle will be stored, you’ll normally want storage insurance so that the car is covered for problems such as theft, fire or severe weather while it’s stored.

If you do cancel insurance while you’re deployed, check with the state where your car is registered to see what’s required when canceling car insurance, such as turning in your plates and registration, so you don’t end up with penalties for being uninsured.

Suspending a Car Insurance Policy During Deployment

Suspending car insurance is different from canceling it. Suspending insurance generally pauses the policy and allows you to turn it back on when you return. That doesn’t mean it’s necessarily a good choice for your situation.

Pros and Cons of Suspending Car Insurance

Pros	Cons
You may be able to turn the policy back on without reapplying for a new policy	There’s no coverage for theft, fire or severe weather events, which could possibly harm the car while it’s parked or stores
You save on car insurance costs by not paying during the suspension	No one can drive your car while the policy is suspended because you won’t have the insurance required by the state
Suspending insurance is not considered a coverage lapse, so it shouldn’t raise future rates as a lapse would	Your state DMV may penalize you unless you turn in your plates or fill out an affidavit of non-use.
	If you have a car loan or lease, you’re ineligible to suspend coverage because lenders and lessors require collision and comprehensive insurance

See MoreSee Less

Not all car insurance companies or states allow customers to suspend their insurance, so contact your insurer to see if it’s even possible.

Affidavit of Non-Use

In some states, such as California, you can fill out an affidavit of non-use to let the DMV know you’re not driving your vehicle for an extended period of time.

How a state handles the non-use of a car varies. In California, submitting the affidavit puts your car into a planned non-operation status, which means you won’t operate or park it on public roads for the entire registration period. This status allows you to suspend or cancel the car’s insurance without being penalized for failure to maintain car insurance.

Check with your state’s DMV about what paperwork you may need to fill out if your car won’t be driven while you’re deployed and you wish to cancel or suspend car insurance. Failure to follow state requirements could result in penalties.

Drawbacks of Temporary Car Insurance

Temporary car insurance has drawbacks:

• It’s not widely available, so finding a company to accommodate your short-term needs can be challenging.
• Temporary car insurance costs can be high because of less competition.

Other downsides to temporary car insurance include:

Losing Your Down Payment

Auto insurers require you to make a payment to start a policy. This may be called a car insurance down payment. You could lose a portion of it depending on how soon you cancel the coverage.

The shortest period for temporary car insurance is typically 30 days, but say you want to cancel your policy after 14 days. You couldn’t recoup the full amount you put down because you used some of the insurance already. You could also be assessed a cancellation fee that will further reduce your refund amount. This can make short-term insurance more expensive than you’d expect.

Immediate Coverage May Not Be Available

If you’re looking to buy short-term car insurance coverage today, you may find that immediate coverage is unavailable. Some temporary car insurance companies don’t offer instant quotes or same-day coverage like the large companies that provide standard auto policies do. You may have to wait for a call to discuss your options and when your coverage can start.

Collision and Comprehensive Coverage End Without a Photo Inspection

When you add collision and comprehensive coverage to an auto policy, you must get a car insurance photo inspection in some states, such as New Jersey and New York, or the coverage will be terminated.

Even if you want a short-term car insurance policy to last only a few weeks or a month, you’ll need to find time to complete the inspection, or you’ll lose comprehensive and collision coverage.

State Legal Requirements vs. Short Term Coverage

State minimum car insurance is required on a vehicle as long as the car is registered in most states. If you buy short-term auto insurance coverage that lasts for only a few weeks or months and then you have no insurance—and don’t turn in your plates or registration—you can face penalties from your state, such as fines.

Gaps in Coverage

You can have a gap in coverage if you don’t buy another policy at the end of temporary car insurance coverage. There can be penalties from your state for being uninsured if your car is still registered, but also, a gap in insurance coverage can raise your auto insurance rates when you buy your next policy.

Drivers with a lapse in coverage pay an average of 25% more than drivers who’ve kept continuous coverage.

Crashes After Short-Term Insurance Ends

Suppose you continue to drive after your temporary car insurance end date has passed and you cause an accident. You’re personally on the hook to pay for injuries and damages you cause to others and your car. The end of a short-term policy can come up quickly, so you must be prepared to buy another temporary policy, a standard length policy or stop driving.

Also, if you’re caught driving without car insurance, the penalties can be severe—in some states, it can even include jail time.

Rental Car Insurance Limits

In most states, rental car agencies automatically provide temporary liability insurance as part of a rental agreement, but these are low state minimum limits. If you want better coverage, you need to have your own auto insurance policy with higher limits that extend to rental cars or buy higher limits from the rental agency, which is usually pricey.

If you’re looking at buying temporary car insurance in hopes it’ll cover a rental car, confirm this before purchasing the policy. Not all short-term policies extend to rental cars. For instance, the insurer Hugo provides on-demand auto insurance and offers rental car coverage with its full coverage plan but not its flex or basic plans.

How Much Does Short-Term Car Insurance Cost?

You might think short-term car insurance costs would be less than a standard policy because your coverage lasts for a shorter period, but that is not necessarily the case. Because short-term insurance is a specialty policy, you may end up paying more per month than what you’d pay for a long-term standard policy.

For instance, we looked at costs with Hugo, a short-term car insurance company. Hugo quoted $22 per week for state-minimum coverage in Ohio, which translates to $88 per month for short-term car insurance. Meanwhile, car insurance costs an average of only $31 per month for a policy with the required minimum limits, according to our analysis of Ohio car insurance rates.

Look at the average cost of car insurance for traditional policies as a comparison point when shopping for short-term car insurance.

• The average nationwide cost for full coverage car insurance is $2,150 per year. That breaks down to an average of $179 per month.
• The average cost for state-minimum car insurance is $467 per year, which is an average of $39 per month.

Just as with traditional auto insurance, the price of short-term coverage varies depending on the options you choose and the type of policy you buy, according to Friedlander. He says you can pick liability-only coverage or select broader coverage that includes collision and comprehensive insurance.

Friedlander notes that a typical short-term car insurance policy lasts at least 30 days, even if you need the coverage for only a day or a week. As with standard policies, pricing for short-term coverage depends on typical auto insurance cost factors like:

• Intended use of vehicle (personal or business use)
• Location
• Vehicle model
• Your auto insurance coverage history
• Your credit-based insurance score (states that restrict the use of credit in setting auto insurance rates are California, Hawaii, Michigan and Massachusetts)
• Your driving record

Who Sells Short-Term Car Insurance?

Short-term car insurance is not widely available. While car insurance companies typically don’t advertise one-month policies on their websites, Forbes Advisor found that these companies have made filings with state insurance departments to provide one-month car insurance policies:

• American Hallmark Insurance Co. of Texas (one-month auto insurance policies available only as renewal policies)
• Apollo Insurance
• Dairyland (one-month auto insurance policies available only as renewal policies)
• Direct General
• First Chicago Insurance Co.
• National Unity Insurance Co.
• Old American County Mutual Fire Insurance Co.
• Young America Insurance Co.

There is also a company called Hugo that offers on-demand car insurance. Hugo offers different insurance plans, with its flex plan allowing you to buy three, seven, 14, or 30 days of car insurance—and add more days as needed.

Hugo’s flex plan lets you turn on and off the coverage to use up the days you pay for, but Hugo recommends you turn on insurance at least one day a week. If your insurance is off for seven days or more, it is required to notify your DMV of a lapse in car insurance.

Related: How to Get Cheap Same-Day Car Insurance

Why Some Car Insurance Companies Don’t Offer Short-Term Policies

Friedlander says most national and regional insurance companies don’t offer short-term car insurance policies. For insurers, the risk of offering short-term coverage outweighs the benefits of selling this kind of coverage.

The potential of paying out a large claim for a customer that pays only for a very limited policy, such as 30 days, doesn’t make financial sense to insurers, so major insurance companies concentrate their business on those who want standard long-term policies that last six months or more.

Other Ways to Get Short-Term Car Insurance

So, what if you aren’t able to buy a 30-day car insurance policy? Alternatives include:

• Buy non-owner car insurance. If you don’t own a vehicle but need coverage, non-owner car insurance may be an option. This coverage might be a good choice if you frequently rent cars, so you don’t have to buy liability coverage from a rental car company. Or it could fill the insurance void when you’re between vehicles.
• Cancel a standard car insurance policy. You could buy a standard car insurance policy and cancel it once you no longer need the coverage. In some states insurance companies can charge a fee if you cancel a car insurance policy early, so check whether a cancellation fee could apply before you buy.
• Take advantage of a mileage-based insurance policy. If you want car insurance but don’t drive often, your best choice might be to buy a pay-per-mile insurance policy. With this type of policy, your rate will depend largely on how much you drive.

Should I Get Short-Term Car Insurance?

Only you can decide whether short-term car insurance is your best option for cheap car insurance based on your situation.

Be careful if you decide to pursue a policy with a company that offers short-term coverage. You want to make sure you purchase from a legitimate company that offers a policy providing enough insurance coverage to meet your needs.

In many cases, you can obtain temporary auto insurance through other means. It may be as simple as tweaking your current auto insurance policy so that it meets your needs.

There is no “one-size-fits-all” approach to short-term car insurance. If you are unsure of the best choice for your situation, talk to an auto insurance agent to discuss your situation and the possible options.

Short-Term Car Insurance FAQs