Car Insurance for Occasional Driving

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Jessica Sautter is a Content Writer for with a Bachelor’s Degree from Eastern Michigan University in Elementary Education with a Major in Reading and a Minor in...

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Chris Harrigan has an economy degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise...

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Reviewed byChris Harrigan
Former Insurance Claims Manager

UPDATED: Mar 31, 2020

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Key takeaways...
  • If you only drive your vehicle occasionally, it’s possible to save money on your car insurance policy
  • Anyone who owns a car must comply with the state’s auto insurance laws even if they only drive the car occasionally
  • Most states have mandatory insurance laws, but there are states with alternative options to prove financial responsibility
  • Make sure to calculate how much you think you’ll drive your car and take advantage of a low-mileage discount
  • Vehicles that aren’t used often may also qualify for a pleasure usage and extra vehicle rating that saves money

Not everyone relies on a car to get business done. In fact, recent studies show that Millenials are less reliant on cars than the generation before them.

It’s anticipated that vehicle ownership will continue to drop as more and more transportation services like Uber and Lyft become available in metropolitan, suburban, and rural areas.

Driving is still the favorite mode of transportation when it comes to commuting to and from work.

Although the reliance on vehicles in the United States is still very prevalent, some vehicle owners make the conscious decision to drive their cars only occasionally. These cars still need to be insured, even if they act more as a decoration the driveway than a mode of transportation.

Let’s discuss what you need to know about insurance for the occasional driver.

If you’d like to go ahead and start comparing auto insurance rates, enter your ZIP code above!

What do the statistics say about vehicle ownership and usage trends?

The automotive industry isn’t happy to hear that the 21st century has officially been declared as the end of the car age. More and more people are connected by public transportation and vehicle sharing services, and it reduces the average person’s dependence on their vehicle.

A huge percentage of Millenials aren’t even getting their license let alone buying their own car.

Not only are people steering clear of getting a license, many Americans are driving less and getting rid of their cars in all age groups. The rate of car ownership has declined by nine percent and so has the number of miles driven per person.

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If you drive occasionally, do you even need insurance?

As you can see, you’re not alone when it comes to cutting back on your driving. There may have been a time where you drove everywhere with little regard to gas consumption and wear and tear. Now that you realize how much it truly costs to drive, you might just keep your license in unique situations where you’ll need to drive.

If you drive occasionally rather than regularly, you may still need insurance. It all depends on whether or not you own the car you’ll be driving.

If you own the car, you must comply with whatever the state’s insurance law says in the state where the vehicle is registered.

Most states require some form of liability auto insurance.

If you don’t own a car, you don’t legally have to buy insurance. Even though it’s not required by law, you might consider a non-owner’s policy for protection when you’re borrowing someone’s car.

A non-owner policy affords you some form of low-cost liability coverage when you’re renting a car or borrowing a car from someone you don’t live with.

Is auto insurance mandatory in every state?

The state legislature dictates whether or not residents in the state have to insure an automobile when that personal vehicle is registered through the motor vehicle agency. While insurance isn’t required in every state, there are only two states in the whole country that don’t have a compulsory insurance law.

Some states may have modified compulsory insurance laws that say that a vehicle owner could satisfy the law by purchasing insurance or by proving they are financially responsible in another way.

Some alternative forms of proof that states accept include:

  • A cash deposit with the state treasurer
  • Filing a surety bond with the state secured by collateral
  • Filling out an application for self-insurance that’s approved by the state

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Why is auto insurance the best option even for occasional drivers?

It’s always nice to feel like you have options. If insurance isn’t explicitly mandatory and you only drive your car from time to time, it’s very tempting to just deposit the money and avoid paying premiums.

Unfortunately, you’ll have to deposit thousands of dollars that will be held by the state just in case you have a loss.

Most people don’t want to part with thousands of dollars in the blink of an eye. Others don’t want to sign their home or other property as collateral for a bond.

The best option is to pay premiums for auto insurance that provides you with protection for pennies on the dollar. Paying for coverage that you don’t need can protect your money.

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Can you save money on your policy for being an occasional driver?

As much as you don’t want to pay for insurance, it’s nice to know that you can qualify for some discounts just because you only drive your car occasionally.

How you use your vehicle and how often you use it are important rating factors.

Those who use their cars a lot are a higher exposure to risk and those you use their car less aren’t exposed to loss as often. The less that you’re exposed to a potential loss, the less that you’ll pay for your insurance.

Here are some ways occasional usage can influence your rates:

  • Vehicle usage rating if you only drive around town for personal use, you can classify yourself as a pleasure user and save money compared to commuters
  • Annual mileage rating you’ll be asked to estimate how much you’ll drive your car. Vehicles that fall into a low mileage bracket will receive a low-mileage discount
  • Daytime driver mature drivers over 55 may be able to get a discount off of their coverage if they only drive their car during daylight hours
  • Multi-car rating when you own another car in the home, you’ll automatically get a multi-car discount off of both cars
  • Extra car rating if you have more cars in your home than licensed drivers, you may receive an extra car rating

Should you carry minimum limits if you only drive occasionally?

You have to have minimum limits for Bodily Injury and Property Damage coverage when you’re securing a policy just to comply with the state.

Sometimes, limits that are required are as low as $15,000 per person and $30,000 per accident.

That type of limit might be enough to pay for minor injuries, but it’s not going to save the day if you’re in a multi-car accident.

No matter how little you drive, it only takes one trip the local store to change your life. Car crashes can happen in the blink of an eye and if you panic for just a second you could be the one found liable for the event.

If you elect to carry a minimum amount of protection and the worst happens, your drive to the store could cost you your income and your assets.

How do you insure a financed or leased car that you drive occasionally?

You can’t buy state minimum coverage on a financed car and call it a day. Purchasing a basic policy is the most popular way to keep premiums low, but failing to carry additional coverage will land you in hot water with the finance company.

Your lending agreement says that you have to insure the property you’re financing. Since you don’t hold the title to the car, you are expected to insure it just so that finance company knows that you can repair it or replace it after any common type of loss.

You need to carry comprehensive and collision insurance at a minimum.

Driving occasionally isn’t a way to dodge insurance laws. If you own a car, you need coverage. Your policy doesn’t have to cost a fortune if you put in the time to shop around. Use your time wisely and log onto the Internet to comparison shop rates on a single platform.

Start comparison shopping today for better auto insurance rates! Enter your ZIP code below!

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