Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insuranc...

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Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He also has an MBA from the University of South Florid...

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Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Dec 17, 2021

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At a Glance

  • Short-term auto insurance is intended for those who frequently borrow or rent vehicles
  • These policies are often shorter than the standard six-month and annual insurance plans offered by auto insurance companies
  • Short-term insurance can save you time and money

An auto insurance plan is something that requires careful consideration. You’ll want a policy which will cover just about any accident. But what if you’re driving a borrowed car, or you don’t drive very often?

Would short-term auto insurance be right for you in this scenario?

Read on to learn more about short-term auto insurance, then enter your ZIP code in the quote box to find the best prices on insurance in your area.

What is short-term car insurance?

Short-term car insurance refers to any policy that lasts less than six months. These plans typically last 30 days and are designed to cover people who borrow or rent a vehicle.

For example, if you borrowed a friend’s car but didn’t want to pay their insurance policy, you could opt for short-term car insurance while you own the vehicle.

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Why would you need short-term car insurance?

Short-term car insurance is helpful in situations where you aren’t in possession of your own vehicle. You’ll receive basic coverage without worrying about paying premiums that are typical of regular auto insurance plans.

You would need short-term car insurance in the following situations:

  • If you are renting a vehicle.
  • If you only drive occasionally.
  • If you are driving another person’s vehicle while yours is being repaired.
  • If you are borrowing another person’s vehicle for a lengthy period of time. You won’t need short-term insurance if the period is only for a few hours.
  • If you bought a vehicle and plan to resell it soon.

If you’re renting a car from a rental service, you can buy coverage from the company and skip other kinds of temporary auto insurance offered by insurance companies.

Advantages of Short-Term Car Insurance

While annual car insurance plans offer more coverage, there are advantages to purchasing a short-term insurance policy. You can typically save time and money by relying on temporary international auto insurance coverage, especially if you don’t drive often.

Short-term car insurance has no effect on your No Claims Discount (NCD). These discounts reduce the cost of a policy the longer you go without filing a claim, but a single accident can throw everything into jeopardy.

When you have short-term insurance on a vehicle, any claims you file will be met by the short-term policy rather than the annual insurance. This allows you or the primary owner of the vehicle to maintain an NCD without having pay any additional costs.

Setting up a short-term policy is also much faster than adding a new driver to an existing annual insurance policy. Amending a preexisting plan requires multiple phone calls to the insurance company, and the primary vehicle owner may have to pay an amendment fee.

It can also take a few days for the amended policy to be certified.

With temporary insurance, a policy can be amended in as little as 15 minutes.

You also have the option of only paying insurance for certain months on a short-term plan. For example, if you are a student and only drive during the summer months, you can purchase a policy that only covers your vehicle for that season.

Disadvantages of Short-Term Car Insurance

Short-term car coverage has its incentives. But it’s important to remember that they’re only meant for the short-term.

Thus, there are several downsides to relying only on a temporary insurance policy.

By law, drivers in every state are required to have liability insurance in place for their vehicle. In the event of an accident, liability coverage protects you from paying out of pocket for damages to people or property.

For most states, the average liability minimum is between $25,000 and $50,000.

Short-term insurance plans usually don’t include liability coverage as part of the policy. If you are caught driving without liability insurance, your license could be suspended.

Having a short-term insurance plan also leaves gaps in your coverage history. Most insurance companies equate these gaps with a driver being uninsured, which then leads the insurer to assume that their client is at high risk of getting in accident.

If you have gaps in your insurance coverage, then your premium can increase up to $15 a month.

You might also be ineligible for certain coverage options on a short-term plan. On an annual insurance policy, insurance companies may limit the use of comprehensive coverage for the first month after signing the policy before offering full coverage afterward. This simply isn’t possible with short-term car insurance.

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Where do you purchase short-term car insurance?

Most major insurance companies don’t offer short-term insurance plans. It’s in their best interest to only offer six-month or annual coverage policies, as offering short-term cover can be risky.

If you already have a standard insurance plan but want to switch to short-term coverage, then you would need to cancel your current policy. However, this puts you at risk of incurring early termination fees. If you’re taking a vacation, going home for the holidays, or visiting friends, GEICO short-term car insurance can help protect your trip. However, since reputable insurers don’t generally offer temporary car insurance, you might find it difficult to get GEICO one month car insurance.

You can purchase short-term insurance coverage from a rental agency if you routinely rent vehicles.

Short-Term Car Insurance Alternatives

Say you want to invest in a temporary auto insurance plan, but without any of the drawbacks that come with using that type of coverage. What can you do?

There are alternative ways to get short-term coverage through your insurance provider without encountering any of the aforementioned drawbacks.

Secondary Insurance

When you borrow or rent a vehicle, you may be able to use secondary insurance if you file a claim while in possession of the car.

Having secondary insurance means that you will cover the cost of any damages once the primary insurance holder’s policy is exhausted. This would also require you to file a claim with your insurance company in addition to the owner’s insurer.

Storage Insurance

This type of insurance is also called “parked car insurance.” Even if you don’t drive your vehicle very often, having this kind of policy will keep it protected from any damage.

It acts as an extension of comprehensive coverage. This means your vehicle is covered for damage caused by external factors, such as natural disasters, animal damage or vandalism.

Storage insurance also reduces your premium, saving you money.

Permissive Users Clause

If you’re borrowing a friend or relative’s car, you can be covered under a permissive users clause if their policy includes one.

Permissive coverage extends coverage to an additional driver if they drive a vehicle infrequently. Most insurers consider “infrequently” to be less than 12 times a year, though it’s up to the vehicle owner to determine what the definition of infrequent driving is.

Being Temporarily Added to a Policy

You can be temporarily added to an existing driver’s policy while you are driving their vehicle. Once you no longer require the car, the policy owner can then remove you from the policy without any additional costs.

Note that this coverage is dependent on two factors: how long you will be driving the vehicle, and whether or not the insurance company considers you to be an “at-risk” driver.

Want to save on your auto insurance? Enter your ZIP code in the box below to compare insurance rates in your area.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.