Most insurance experts will tell you that there’s no such thing as one-day car insurance, but the truth is that it's something of a gray area. The major auto insurance companies in the United States won’t sell you an auto insurance policy for just one day, but some insurers are willing to issue “temporary” or short-term car insurance.
There’s one universal rule: Driving without car insurance coverage is illegal in almost every state.
Traditional Policy Terms
Major insurance companies rarely issue policies for less than six months. One-year policies are more the norm, and this makes sense when you think about it. The premiums you pay to your insurer must be more than any claim you might make. Providing the policy makes no financial sense for the insurance company otherwise. You might insure your car for one day, pay $30 for the privilege, then promptly take a road trip and total your vehicle. Your insurance provider would be on the hook for thousands of dollars – and the insurer only charged you $30 in exchange for taking that risk. It’s a losing proposition.
A traditional six-month car insurance policy might be the ticket if you rarely drive. They’re generally not prohibitively expensive, as you might pay as little as $3 a day. And you might qualify for some discounts due to your driving history to bring the cost down even more. Get a few car insurance quotes to be sure. It’s unlikely that a non-traditional policy will offer these discounts to you.
Read More: What Are Car Insurance Discounts?
And about that car accident: Car insurance companies typically increase your insurance premium on a traditional policy after even a minor fender bender, but not until you renew the policy. That could be a fair bit of time if you’re a month into a one-year term.
One-Day Car Insurance: Buyer Beware
There are risks involved if you do manage to find an insurer that's willing to provide you with coverage for less than six months. Those “one-day” deals you might see advertised online or all over billboards are likely to be scams by companies that want to get you on the hook to buy something else. Or worse yet, they're shady characters who just want access to your personal information. In fact, those short-term "deals" are illegal in many states. By law, you must generally have an active insurance policy on a vehicle 24/7 if it’s legally registered.
So why not just purchase a short-term auto insurance policy for six-months, drive for a day, then cancel the policy? It might be tempting, but there are risks involved here as well. It could show up on your insurance record as a lapse in coverage, and this can result in you paying much higher rates down the road, if a reputable insurance agency will even consider you for a policy at all.
You might have to pay a cancelation fee if you "drop" the policy after a single day by simply not paying any further premiums. This will definitely be a blemish on your insurance record. Be sure to cancel the car registration, too, if you take this option.
Read More: Can Insurance Charge a Cancellation Fee?
When you find yourself in a position where you want to drive, intermittently purchasing a non-traditional short-term policy can have the same drawbacks. You’re not consistently covered with a temporary car insurance policy, and these policies don’t always provide comprehensive or collision coverage if damage occurs to the vehicle you’re driving. They might only provide liability insurance.
Other Options: Non-Owner Insurance
So what’s a one-day driver to do? You have some options, depending on why you don’t want to commit to a six-month policy.
Some insurance companies offer non-owner policies. This obviously isn’t an option if you actually own the car that you rarely drive, but it can provide coverage if you occasionally – or even frequently – borrow a friend's car or family member’s car to get around, and their policy doesn’t cover you for some reason. Most major companies offer this type of insurance.
These policies invariably require that the owner of the car also have coverage, however, and they generally only provide liability coverage. They won’t pay out if the car is damaged or destroyed while you’re behind the wheel.
Rental Car Insurance
You don’t have to concern yourself with lining up insurance if you just want it to rent a car. You must still have some coverage, but the rental agency provides you with a short-term policy – at your expense, of course. This will run you about $19 a day, according to AutoInsurance.org, although you might only be insured for liability, not damage to the vehicle.
This extra insurance is not even necessary if you own a car that’s already insured. Your own coverage typically extends to any vehicle you rent. State Farm, GEICO and USAA all provide this type of coverage.
You can ask the rental car company for a “collision damage waiver,” agreeing that they won’t hold you financially responsible for any repairs or if the car is stolen while in your possession, but you could pay as much as $30 a day for this option. Your credit card provider might offer this type of coverage as well at a less prohibitive cost, so it could be worth giving them a call. This option doesn’t typically include liability coverage, however, so you could be sued if you’re in an accident and cause damage or bodily injury to the other driver or car.
Read More: Advice on Rental Car Insurance
Insurance by the Mile
You might consider pay-per-mile insurance if you have a car but you don’t drive very often, so you cringe at the thought of paying sometimes-hefty premiums for a six-month or yearly car insurance policy. These policies can turn out to be cheap car insurance because they charge you just a low, daily rate when you get behind the wheel, plus a few cents – literally – for each mile you drive. The savings over a traditional policy can be significant, but it's still a good idea to get at least a couple of insurance quotes to find the best policy for your needs.
You Might Not Need Temporary Car Insurance
It’s possible that you might not need a one-day policy, a non-owner policy, or even temporary auto insurance at all if you’re not looking to insure your own car but someone else’s. It’s usually impossible to insure a car owned by someone else in any event. You don’t have an “insurable interest” if you have no ownership interest in the vehicle.
Traditional car insurance policies generally follow the car. The owner carries a policy on the vehicle, and that policy covers anyone who drives it. They’re referred to as “permissive drivers.” This would be the case even if you have your own car and it’s covered by your own policy. Your policy generally would not pay for an accident that occurred with someone else's vehicle. You’d be covered by the owner’s policy if you’re borrowing a car from a friend or family member.
This type of coverage might be somewhat limited in some cases, but it usually provides the legally required liability insurance to pay for damages to another car or for bodily injury to another driver if you're involved in an accident. You can also ask that friend or family member to add you to their policy as an authorized driver if you borrow their wheels with some frequency. It might increase their premiums, but you could always offer to pay the difference.
As for test driving a car that you’re thinking of buying from a dealership, this doesn’t require that you personally have insurance coverage on that vehicle, either. The dealer provides that coverage.
- Insurify: One-Day Car Insurance Quotes (2021)
- Motor1.com: Can I Get One-Day Car Insurance? (2021)
- AutoInsurance.org: Temporary Auto Insurance
- Bankrate: Temporary Car Insurance
- Insurance.com: What Is Temporary Car Insurance?
- StateFarm.com. "Car Insurance Coverage Types." Accessed July 20, 2020.
- PolicyGenius.com. "Short-term and Temporary Car Insurance." Accessed July 20, 2020.
- Mass.gov. "Massachusetts Consumer Bill of Rights." Accessed July 20, 2020.
- TempCover.com. "Temporary European Car Insurance." Accessed July 20, 2020.
- U.S. Federal Trade Commission. "Renting a Car." Accessed July 20, 2020.
- DC.gov. "Things to Know About Car Insurance and Rental Cars Before Starting Your Road Trip." Accessed July 20, 2020.
Beverly Bird has been writing professionally for over 30 years. She is also a paralegal, specializing in areas of personal finance, bankruptcy and estate law. She writes as the tax expert for The Balance.