All About Short-Term Car Insurance

Whenever we talk about insurance, it is perceived to be a long-term investment. Car insurance is not as rigid as you think it might be. You might have heard of regular car insurance, but do you know that it is possible to get a car insurance for a shorter period of time which is popularly known as short-term car insurance. 

Read on to know all about short-term car insurance – what it is, how does it work, and what are its benefits. 

What is short-term car insurance?

True to its name, short-term or temporary car insurance provides coverage for a short period of time. The validity of short-term insurance can vary between less than a few minutes to a few months. This insurance works if you don’t want to buy the insurance for a full year. It is not very popular in India, but in UAE and other foreign countries, the concept of short-term car insurance is really popular.

How does short-term car insurance work?

Short-term car insurance works best when the car owner doesn’t want an insurance for a long period of time. In certain situations like – driving a rented car, relocating to a new city, or when learning to drive short-term car insurance works the best.

You need to provide the following details to get short-term car insurance –

• Personal details like – name, address, profession, gender
• Proof of address in the UAE
• Identification documents – claim history, driving license
• Car details – engine capacity, model and make, manufacturing year

Types of short-term car insurance

A lot of people think of short-term car insurance comparison with comprehensive car insurance. Each of them has different features and is targeted towards varied needs of car owners.

There are three types of short-term car insurances –

• Rented car insurance

This is the car insurance if you have a rented car. Generally damages due to accident and accidental injuries are covered in a rented four-wheeler insurance policy.

• Gap insurance

Gap insurance is the type of short-term car insurance for cars that you have bought on lease or loan. Under this policy, the car should be financed by a third-party and the insurance provider compensates the market value of the vehicle.

If the loan amount is more than the market value, then the gap insurance will pay the balance amount close to the loan of the policyholder.

• Non-owners insurance

Non-owners insurance is similar to rented short-term car insurance. However, it is mostly offered in private cars. For example – a person will most likely buy non-owners when borrowing a car from a friend or relative. 

Short-term car insurance benefits

You can choose short-term car insurance for one, six, or nine months, depending upon your requirements. Short-term car insurance cost is cheaper as compared to comprehensive car insurance. Some of the main benefits of short-term car insurance are –

• Helps provide instant coverage
• Provides Third-party property damage cover
• Accidental damage
• Coverage duration can be customized
• Provides personal accident cover for the driver
• Get the option to buy the policy for a minimum of 30 days before its start date 

When should you buy short-term car insurance?

Short-term plans provide coverage against multiple liabilities like accidental damage, calamities, the personal accident of the driver, etc. and financial protection against damage arising due to natural disasters and man-made calamities. In certain situations it is ideal to opt for short-term car insurance over comprehensive car insurance. These are the situations –

• When you are using a rented car
• When you are learning to drive
• When your car is not usable
• Drivers with less driving experience
• When you want to resale a car soon after its purchase
• When driving a borrowed vehicle from a friend or relative
• When using a car in another state for business purposes 

  Frequently Asked Questions (FAQs)

1. Is there an eligibility criterion for buying short-term car insurance? 

The eligibility criteria for buying short-term car insurance includes –

• A person between the age 18 – 25 years with a valid driving license can buy short-term car insurance in the UAE.
• If the person wants to learn driving, then he/she should have a valid learning driving license. A person with a permanent driving license should accompany the learner if they want to buy a short-term car insurance
• If the person is borrowing a car, he/she should be between the age of 17 – 30 years to get short-term car insurance 

2. Can I add multiple cars to short-term car insurance?

Yes, some insurance companies allow the policyholder to add multiple vehicles to their temporary car insurance policy. However, the cost of such a policy will increase with the addition of each car.

3. What are some things to keep in mind before buying short-term car insurance?

Keep in mind that short-term car insurance is a little difficult to find, so be careful about the insurance provider you choose. It can also come at an increased cost when compared to a conventional car insurance policy. One should always check the coverage, terms and conditions, exclusions etc. of the policy before making a purchase.

4.  Can I insure the car for just one month?

Yes, one can insure the car for a month or less with short-term car insurance. It is perfect for cars that need to be used for a short duration.

5. Is it necessary to inform the existing insurance company if short-term insurance is not bought from them?

No, it is not necessary to inform the existing insurer about buying short-term car insurance. But in case you are borrowing a car from a friend or relative, then it is important to inform them and take permission from them. 

Author Bio: –

Kritika Manchanda is a content writer with BuyAnyIsurance. She has more than a decade of experience of churning out SEO friendly content. When she is not writing, she is either reading, or making travel plans.