In the car insurance world, you normally have two main types of insurance policies: standard and temporary. Standard insurance is the usual policy you get every year – it covers you for twelve months until you either renew or take out a different policy elsewhere.
Temporary car insurance is when you insure your car for anywhere between a couple of days and a whole month. While everyone understands standard insurance – and will certainly take out a policy every year – most of you don’t truly get the point of the temporary variety. Why might this be useful, can it help you save money, and when does it make sense to get?
The Right Times To Get Temporary Car Insurance
Opting for short-term car insurance does make sense in a few scenarios. It’s not something you should consider instead of a standard policy – though it is useful if you find yourself in any of these situations:
Buying a car
Temporary insurance is good in two cases when buying a new car:
- You need to drive the car away from the dealership
- You’re testing a privately-owned vehicle
Some dealerships will insure you for 24 hours when you buy a car, but that’s not always going to be the case. In that instance, temporary insurance helps you drive home without breaking the law – and then you can spend time looking for the best standard insurance policy.
Also, if you go to test drive a car that’s sold by a person and not a dealership, temporary car insurance can give you coverage for that. It means you can’t be stopped on the roads during your test drive – and it also gives the seller peace of mind in case you crash (which hopefully won’t happen!).
Insuring a vehicle you barely use
Let’s say you’ve got a lovely campervan or a sporty car that you don’t drive that regularly at all. Perhaps you take it out a few times a year at most – in cases like this, standard car insurance is way too costly for a vehicle you barely use.
Getting short-term insurance saves money and is way more convenient. Imagine you’re planning a summer road trip and want to take the car that usually stays in your garage. Simply insure it for a couple of days, and you’re ready to go.
Insuring someone who needs your car temporarily
It’s entirely possible that someone needs to use your car for a few days or weeks. The most common example of this is if you have older children who go off to university. They return for a few weeks every now and then, and want to drive your car so they can get around.
There’s no point adding them as a named driver to your standard policy, so temporary car insurance makes so much sense. You only pay for as many days as they need the vehicle, saving money for everyone involved.
The same goes for any instances when you might need someone else’s car temporarily. For instance, you’re driving to the airport and want to borrow your brother’s car because it can carry more luggage. In that instance, short-term insurance means you can both drive one another’s cars legally.
After selling your car
Short-term insurance makes sense when buying a car, but it also helps when you sell your current vehicle. What typically happens is that you take out an annual car insurance policy and have to stick with that provider until the cancellation date. Otherwise, you’ll pay admin and cancellation fees to end the policy early.
So, what happens when you sell the car that you’ve insured?
You need to remove the old car and add the new one, but it could be cheaper to find a new policy elsewhere for the new vehicle. You’re stuck with a conundrum: you need to insure this new car, but you don’t want to alter or cancel your existing car insurance, as this costs money.
Temporary car insurance provides the best solution – especially if you’ve only got a month or so left on your policy. Simply stop the existing policy from automatically renewing and use short-term insurance to cover your new vehicle for a month. Then you can cancel your standard insurance without paying fees and take out a new annual policy that’s a lot cheaper.
Does Temporary Car Insurance Save Money?
Yes and no.
As you’ve seen from above, getting temporary insurance for a vehicle will save money in very specific circumstances. For example:
- It’s sometimes cheaper than adding a named driver to your annual policy if the named driver is under 25 and won’t drive the car regularly.
- It saves money by acting as stop-gap insurance after selling a car, rather than forcing you to pay for two annual car insurance policies at the same time.
- It might save money when buying a car instead of using the dealership’s insurance, as they sometimes overcharge you and add the costs to your total bill.
All in all, it definitely serves a purpose and can be used to save money in some scenarios. However, you shouldn’t consider short-term car insurance as one of the overall solutions for bringing your annual car insurance premium down.
For example, it’s not going to be cheaper to continuously pay for short-term insurance throughout the year. You’re always better off getting annual insurance for a car you drive regularly. It’s far smarter to look into other money-saving ideas to lower your annual premiums, such as:
- Comparing quotes from as many providers as possible
- Driving safely and avoiding any insurance claims
- Only adding experienced named drivers with a good no-claims history
- Increasing your voluntary excess
- Lowering your expected annual mileage
The bottom line is that short-term car insurance makes sense in a lot of unique scenarios. It’s great if you’re borrowing someone’s car, or someone is borrowing your car. It’s a brilliant way to save money when insuring vehicles that rarely get on the road – like a car you only take out in the summer. The key is in the name; don’t look at it as a long-term insurance solution. If you need to insure a car for a few days to a month, then that’s when temporary insurance thrives.
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