Temporary Car Insurance – A Stop Gap Insurance

It seems like a strange concept, temporary car insurance, insurance that you take out for a short period of time. You would think initially if you have never used this type of insurance, what is the point?

Surely it would be better just to get a full annual policy. In fact there is a growing demand for this type of car insurance and indeed for insuring a van. This is because at some point everyone finds that they need to borrow a car or van from a friend or relative, hires a car or wants to test drive a vehicle from the showroom.

Under normal circumstances most people will not be insured to drive another car, in fact many people assume that their own insurance or that of the company or other person will cover them. More often than not they will not be covered by the policy, this means that you need insurance.

It would be expensive to have to buy a whole annual policy just to drive a vehicle for a day or two. It can also be expensive to alter an existing policy such as your own or that of the person whose car you may be wanting to drive.

The solution to this situation is to take out car insurance just for the period of time that you will be driving the car for. This is now available as a temporary car insurance policy. It is the same type of car insurance that you get for your normal annual policy that covers you for a year except it can cover you for as little as a single day.

The benefits of this type of cover is that you are only paying for the time that you need, this means that you will be paying out less money and only paying for what you are actually going to use. 

You can get this type of car insurance for anywhere up to 28 days but if you need it longer you can just take out another policy which can last up to another 28 days. The other advantages of this type of insurance is that if you find that you need to extend your cover for a day or two all you need to do is log into any internet connected computer and update the policy online. The changes are made instantly, you can do this from any computer as you will have login details only known to you.

The Car Insurance Calculation Explained

When you get an online insurance quote, different companies will apply various factors to the way they finally arrive at a premium for your specific quote.

Generally speaking though, the concept is the same. This involves collecting various bits of information from you and feeding it through a computer system which adds or takes away money depending on the answers you give. The value put on these answers is decided by the individual insurance company.

For example, some companies may believe that having a speeding conviction increases your chance of having a personal injury accident in the future – therefore they may add money to your price if you have such a conviction.

Similarly, some underwriters may decide that because you have a lot of No Claims Bonus Years then you are less likely to claim – therefore they may discount your price.

Your age is one of the more significant factors affecting your quote. Young drivers in particular will be hit hard with higher costs due to their lack of experience and the overall industry statistics which show increased claims for this age demographic.

All in all there are around 30 different factors that may affect your final premium. Now you can see why you get such a difference in the price of your Car Insurance by going to various companies.

Each company will have it’s own view of what they believe should be assigned to each answer you give. The Car Insurance quote you get through our website looks at over 100 of the leading providers in the market, ensuring you get the lowest price for your particular circumstances.

New Concepts in Car Insurance – Pay as You Drive

You can pay as you talk with a cell phone plan, so why not pay as you drive auto insurance? It sounds like a good idea; but would pay as you drive auto insurance work for you?

The idea behind pay as you drive auto insurance is simple. Basically its this- if you do not drive very much, you will not pay high insurance premiums. Advocates for this type of insurance policy think that there are many merits to this type of program. Less air pollution, lower gas consumption, and lower costs to the consumer among them.

What if you car pool to work, or take public transit? You are not using your car very much so why are you paying high premiums. With a pay as you drive auto insurance premiums you would be able to quite literally pay as you go. Another situation where this plan would be of benefit is that of many retirees who have winter homes in temperate climates, the ‘snowbirds’ living in Florida or Arizona six months of the year and six months in New York or Toronto for example.

Essentially the insurance companies would set an average driving amount for each car type. It could then be broken down into a cents per mile basis. If you wanted to us the pay as you drive auto insurance system you could purchase a set number of miles and you would be covered for insurance during this period.

Pay as you drive auto insurance is an excellent idea for those individuals who do not use their car very much or try to find cost saving methods or environment saving alternatives. Currently this type of program is not yet available, but there are supporters in many states who are hoping to change that soon.

Groups including Environmental Defense, the Conservation Law Foundation and even the U.S. Environmental Protection Agency are working to organize a national cooperative that would work with insurance companies to offer deep discounts for low-mileage drivers; halfway a step toward PAYD (Pay As You Drive) insurance.

General Motors and On-Star Offers PAYD Rates. In mid-2004 General Motors Acceptance Corporation (GMAC) Insurance began offering mileage-based discounts to OnStar subscribers located in some states. The OnStar system reports a vehicle’s odometer readings at the beginning and end of the policy term to verify mileage. Motorist who drive less than specified annual mileage can receive insurance premium discounts of up to 40%.

PAYD programs are also currently available in Israel, South Africa and Holland. PAYD is gaining momentum, and will be coming to your area soon.