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Temporary Car Insurance: When & How To Get It

Written by Todd Clay. Posted in Research Last Updated: 04/10/2012

Why you may need a temporary car insurance policy – and how to get short-term coverage.

Temporary Car Insurance for Car Rentals

You may need temporary car insurance if you're renting a car.

Drivers need auto insurance in most US states. If you’re behind the wheel and not carrying an insurance policy, things could go bad quickly.

If you cause an accident, you will still be responsible for damages caused. You may even be responsible for actions you don’t cause, like in a no-fault state. That’s why it’s important to get liability coverage whenever you drive.

However, if you’re only driving every once in awhile, temporary car insurance may be sufficient. “Temporary car insurance” is a term used for short-term policies. Technically, every insurance policy is temporary because it only lasts until your next renewal – 6 months or a year down the road. However, temporary car insurance policies are used to cover drivers in situations not-deemed permanent by insurance carriers.

When You Might Need Temporary Car Insurance

There are several situations where you might need temporary car insurance. This list is not comprehensive but shows typical situations where temporary car insurance coverage would be appropriate.

  • Road-trip coverage for a rental car.
  • Renting a vehicle for other-than vacation purposes.
  • Covering a child who’s learning to drive
  • Comprehensive protection for a stored car.
  • Classic car insurance while driving, if it’s not normally covered.
  • Test driving a vehicle.
  • Borrowing a friend’s vehicle.
  • Temporary ownership of a vehicle.
  • Foreigner visiting the US and driving a vehicle.
  • And more…

Contact Your Current Insurance Company First

If you think you need temporary coverage, check with your current insurance company first. If you have an auto policy in place, your current policy should extend coverage to any other vehicle you drive. No need in buying something you don’t need.

If you don’t have a policy, but you’re driving other people’s vehicles on a regular basis, many companies offer non-owners policies. This provides you, the driver, coverage usually in addition to the primary policy. Whatever the situation, your insurer should be able offer the appropriate coverage.

A Temporary Policy

Another option is getting temporary car insurance coverage. When renting a car, you can pick up a short-term policy from the rental car company. These policies can be expensive on an annualized basis. But prices are reasonable on a short-term rental – $6-12/day.

Check with your regular insurance carrier as well. A traditional insurance company typically offers better rates than rental car companies. These policies can last 1-30 days. However, not every company offers them. For convenience sake, it may be best to just go with the rental car option.

Another Option: Take out a Regular Policy

If you plan to need temporary car insurance for one month or longer, you might also consider getting a traditional policy. You are only responsible for premium while you need auto insurance. If you cancel the policy – say after 6 weeks – the insurance company is responsible for returning any premium that is due. It’s called the return of unearned premium and the state insurance boards regulates it. If you go that route, make sure you only pay for monthly car insurance.

If you need a quote for temporary auto insurance, apply here:

Temporary Car Insurance Quote

Monthly Car Insurance: Paying Once a Month

Written by Todd Clay. Posted in Research Last Updated: 05/22/2010

You mean I don’t have to front all that cash for my auto insurance premium?

Paying bills with pen and calculator

How to pay for auto insurance every month - not once or twice a year.

Auto insurance policies are contracts that usually last for 6 months or a year. If something happens to your vehicle that is covered in the policy (aka covered peril) during that time – and you’re current with your premium – the insurance company should cover the loss.

However, just because the policy is a 6-month contract doesn’t mean you have to lay down all that cash when you sign up. Most insurers allow policyholders to pay their premiums on a monthly basis. So instead of writing a $500 check every six months, you can pay $83.33 a month, plus applicable fees. This allows you to budget your car insurance like you would your rent, electric bill, etc.

Fees Apply for Monthly Billing

There is usually a fee involved with paying premiums once a month. It can be as low as $1/month – as was the case when I worked with State Farm. Sometimes it’s higher. When Progressive quoted my policy awhile back, I mentioned in my Progressive Review they wanted an extra $70/6-months. I guess $11.67/month isn’t too bad. I just didn’t want them to take $140 out of my pocket every year just because I didn’t have the cash on hand.

You can pay monthly a few different ways – depending on your insurance company. For one, the insurer can pull out the premium from your bank account. It’s convenient since you don’t have to remember to write a check or initiate bill pay. Just remember when the draft happens so you don’t get overdrawn. You can sometimes provide a credit card for the monthly transaction as well. In addition, you can send a check every month. Finally, if you have a local agent, you can pay cash, check, or credit card– depending on their payment capabilities. Once again, the method of payment depends on the company and sometimes your local agent.

Check the Fine Print for Monthly Billing

Bottom line, most insurers allow you to pay your insurance premium every month. They also allow several methods of payment. However, make sure you read the details when you sign up. There’s usually a fee and your overall insurance cost will be higher when you’re paying for car insurance monthly. Check with your insurance company for the details. Read the fine print if there are any questions.

Will Your Premium Go Up If You File A Claim?

Written by Todd Clay. Posted in Research Last Updated: 12/19/2009

Important Things To Consider Before Filing A Claim

Will you have to fork over more of these if you file a claim?

Will you have to fork over more of these if you file a claim?

So you’ve had an accident and you may need to file a claim? But you’re worried about the effects on your next renewal. Will your insurance go up or will it stay the same?

It’s a no-brainer if your premium stays the same – file the claim. But if your rates go up, isn’t that where the insurance company gets their money back? I know what you’re thinking because I ask myself the same questions.

Here are some things to think about before you make that fateful call.

Your Insurance May Go Up

As usual, each claim situation is different. The first question to ask is ‘who’s at fault?’ If you’re not at-fault, you should not be surcharged for the incident. However, companies often use claims history in their renewal calculation. Even though there’s no surcharge, there could be a hidden increase. Rating is a complicated matter and many factors play a part.

However, if you are at-fault in the accident, there’s a good chance there will be a surcharge on your next renewal – probably extending for several renewals thereafter. It’s not so much a case of the insurance company getting their money back, but more of a “friendly” reminder from your insurer that you should drive safer.

Severity Determines The Consequences

The severity of the at-fault incident determines the severity of the consequences. If you are partially at-fault for an incident, there may not be a surcharge for the event. Each insurance company is different, so that’s not a guarantee. However, if the incident is serious enough (Example: Driving drunk, causing an accident, and inflicting injuries on another person) it’s possible your policy will be non-renewed. That translates to exorbitant rates when you get a new policy.

Another thing to consider is losing accident-free discounts. If you’re currently enjoying a discount because you have not had an accident, then a claim may remove that discount. You should be able to see that discount on your policy. Claims can affect that discount and how much you pay on your next renewal.

Call Your Insurance Company

Regardless of the severity of the incident or who’s at fault, you should report all incidents to your insurance company. Accidents can get complicated very quickly. If you fail to report an incident and the other party decides to sue months later, you could have more problems. Your insurance company may question why it took so long for you to report the incident. They may even non-renew your policy.

Play it safe. If you have an accident, call your insurer or agent. If they recommend it, file a claim. After all, that’s why you bought car insurance.

Getting GEICO Insurance Cards for My Vehicle Inspection

Written by Todd Clay. Posted in Related Stuff Last Updated: 11/26/2009

How GEICO customer service impressed me with their phone tree.

The GEICO phone tree impressed this policyholder.

The GEICO phone tree impressed this policyholder.

A few days ago, I had the annual pleasure of taking our Hyundai Sante Fe in for the state inspection. The time had come to spend $29 to get a sticker on my windshield that says my car is safe to drive on Texas roads. Granted, at least I’m not paying the exorbitant fees of some other states, but it was money out of my pocket at a not-so-convenient time.

So I thumbed through my glove box for my insurance cards and sure enough, I hadn’t replaced my old cards when my renewal came in the mail. Having worked in a few insurance offices, I know a lost insurance card is the most common reason customers call an agent’s office or insurance company. So I didn’t feel so bad NOT having it handy. (I’m just glad I didn’t discover it when a cop pulled me over.) But I still needed an updated card for the inspection.

I called the GEICO number listed on my expired insurance cards. Listening to the phone tree, I navigated pressing 3 or 4 options to get a replacement insurance card. They asked for my email address or fax number. Since I’m not the best at texting, I opted for the garage’s handy fax number. Within 3 minutes, GEICO had faxed my updated insurance cards to the garage. And I never spoke with anyone at GEICO.

I know some people are more comfortable talking with a live person to get a new insurance card. Had that been my option, I would have gladly taken it. But in most cases, it would have taken longer for a customer to get new insurance cards after talking with a customer service rep. People get busy, fax machines jam, and other things tend to delay a simple fax. To me, the phone tree is the most efficient use of my time – and the company’s time. I’m just glad the options were easy to understand and it worked.

Kudos to GEICO on getting me an insurance card in a timely manner. I don’t call them often, but when I do, they seem to be able to handle things well.

Auto Insurance Quotes

Written by Todd Clay. Posted in Research Last Updated: 04/10/2012

Five things you need to know about getting a car insurance quote online.

Five Things To Know When Getting Auto Insurance Quotes Online

5 Things To Know for Online Insurance Quotes

Getting quotes for auto insurance is not difficult. However, shopping for car insurance is not usually a top priority for most of us. But when looking to trim down your monthly expenses, it’s worth the time to get some insurance quotes. Consider it an investment. In the right situation, you could save a $150 or more every month on your car insurance.

Here are five things to know when getting quotes on your auto insurance.

#1 – Insurance Companies Want To Help

Insurance companies want more business. One of the major ways insurers make money is by adding policies from new households. That’s why most major companies make it easy to get quotes from new prospects on the internet. When I shopped my policy, Progressive was the easiest website to use to get an online quote. It makes sense – if insurance companies want your business, they shouldn’t put up roadblocks (read: a bad website) to make that happen. That’s why most companies make it easy for potential customers to get online quotes.

#2 – All Insurers Are NOT Created Equal

Just like all restaurants don’t please all customers, it’s the same way with insurance companies. An insurer is only as good as the promise they keep. If you discover several customers from a particular company have had negative experiences, it may be good to look at other insurance companies. To look at customer reviews, check out these insurance companies’ Customer Reviews

#3 – Price (Premium) Varies with Different Carriers

Get quotes from multiple insurers and you’ll quickly discover not all companies’ policies are priced the same. There’s a reason. Actuaries at different companies determine the potential risk for each new customer and thus the price. Because actuaries disagree and companies determine what risk they want to underwrite at a particular time, each company charges a different price (premium) for their policy. It’s important to compare the same coverage, but even then, you will notice price discrepancies between insurers.

#4 – Get Multiple Quotes

If you’re interested in saving money, get several quotes from insurers. Prices vary and you’ll never know how much you could be saving without a few prices. Typically, we recommend getting 3-5 quotes for a new policy or policies. You can even call your current insurer to see what they could do to lower your premiums.

#5 – Invest the Time Now So You Don’t’ Pay Later

When my wife and I were reviewing expenses in 2008, we decided to review our car insurance policies. After shopping around, we ended up saving around $50 a month for two late model vehicles. It’s been a year since we got the new policy. Since then, we’ve saved $600 with our new policies. That’s why I recommend taking an hour or so now to get some auto quotes. It’s definitely worth the money you save.

To get quotes from several companies, go here: Multiple Online Auto Insurance Quotes

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Car Insurance Guidebook Unravels the Car Insurance Mystery

Unless you work in the car insurance industry, the topic is probably a mystery to you. The words deductible, comprehensive, collision, liability, premium, loss of use and bodily injury are all gibberish when they reach your ears.

Unfortunately, insurance is something that you are required to have by law if you want to drive. Because of how confusing it is many people go around in almost an insurance daze while they get car insurance quotes from the auto insurance companies that they have heard of. In reality, they are completely lost as to what they are actually buying.

Instead of looking at what each insurance company offers in the terms of protection for both themselves and their car, they are instead looking for cheap car insurance. Finding the cheapest car insurance coverage makes having to buy the required product all that much less painful, but misses the whole point of having insurance.

Learning about insurance through your insurance agent or websites like Car Insurance Guidebook will give you the upper hand when you looking for car insurance. You can take your knowledge and not only find the best price for insurance, you can use it to find really great insurance to protect you and your assets. Then you aren’t stuck settling for just average car insurance that can hurt you financially if you ever need it because there isn’t enough protection.

For example, when looking for insurance the car insurance rates are just the first of many factors that need to be taken into account when you are shopping around for car insurance. You also need to take into account the type of vehicle that you are driving. Many people don’t know this.

Are you driving around a vehicle that is a new sedan and can be protected under any blanket insurance policy? Or do you have an old car that you fixed up that needs special protection and could be better covered under classic car insurance?

Don’t just assume that when you compare car insurance that it will be a one-size-fits-all policy. This is where the insurance knowledge will come in handy; you will know what you need to protect yourself and your vehicle.

You will understand what your insurance agent is talking about when they use insurance terms and you will actually be able to make an informed decision. This is much better for you instead of the “nod and smile” approach people take in their insurance agent’s office.

Also just like your life changes your insurance needs will change. This year you may just need to learn about the best deductible to have. Next year you may need to educate yourself on car insurance for young drivers. As the years pass, motorcycle insurance may be something you will need to know.

Many wise people say that you never stop learning, so take their advice and educate yourself on the insurance that you spend a lot of money on and can’t get away with not having.