How does short term car insurance work?
Regular car insurance policies provide cover for a one-year period. But what if you’re borrowing a car and only need cover for a month, week or even just for the day? This is where you’ll need to consider short term car insurance.
When would you need short term car insurance?
There are many scenarios in which you may want to consider taking out a short term car insurance policy.
- Your regular car is at the garage being repaired
- You’re borrowing a car so you can learn to drive
- You’re moving house and can borrow a van
- You want to share the driving on a long trip
- You want to drive home a car you’ve just purchased
Do I need to take out a separate policy?
It is possible to be added to a friend’s policy as a named driver should you need to drive their car. However, if you do need to make a claim, it will affect their no claims bonus (affecting their future premiums) and this isn’t always the cheapest option anyway.
Sometimes your existing insurance policy for your own car will cover you for driving someone else’s car (with permission, of course). Check your policy details to see if you have this cover included in your existing policy as this optional add-on used to be fairly common, but is much rarer these days. In addition, the kind of cover is usually only bare minimum third party cover, so damage to your friend’s car itself may not be covered.
If you’re buying a new car, most new car dealers will have some form of short term insurance policy that will be included with the sale so you can drive your car home, but if you’re buying privately you’ll have to arrange insurance cover yourself. A short term policy can be handy in this situation as you can get the car home before shopping around for a better annual deal.
When hiring a car or van you’ll usually be provided cover which included in the price of hiring the vehicle. So taking out a separate policy isn’t really necessary. However, you may choose to take out a short term policy alongside the cover provided by the car hire company as many of these companies only offer third party cover.
Can I save money?
Needless to say a short term insurance policy will be far more expensive than an annual policy if you break down the costs on a ‘per day’ basis. However, if you only need a policy for 1, 28 or 90 days, it can be far cheaper than shelling out for a full year.
Furthermore, if you can find someone willing to lend you their car, borrowing a car and paying for temporary insurance can be far cheaper than hiring a car. All you need to spring out for is the insurance, as you won’t be paying a hire charge (hopefully…)
The main factors affecting how much the insurance itself costs will be the length required for the cover, where you live, how long you’ve been driving, and your licence type.
You will still need to pay an excess if making a claim, so as with annual policies you should play around with how much excess you’re willing to pay in order to achieve the optimum insurance premium for the cover that you require.
Who can get short term car insurance?
Most insurers will cover anyone between the ages of 17 and 75, but a fair few companies choose not to insure anyone under the age of 25 – so be sure to compare car insurance policies to make sure you’re getting the best deal.
You’ll also find it harder to find cover if you have a history of multiple insurance claims, any previous motoring convictions, or points on your licence. You’re also more likely to find cheap car insurance if you have held a full UK licence for a long period of time with several years’ experience driving on the roads.
But of course, you can usually find an insurer willing to provide cover no matter what your situation – you’ll just have to be prepared to pay a little more.
Can any car be covered by short term car insurance?
Most cars will be accepted by insurers for short term policies, but there are some cars that tend to be excluded. These are usually cars that have been modified from their factory specification, or cars that have been imported. You’ll also find that most insurers will also apply an upper limit to the value of cars they’ll consider for short term insurance (usually around £50,000).