Do I have to buy car insurance if I only drive occasionally?

Suppose you have a car which is stored the majority of the time. You only take it out once a month to drive it around the block and keep it running, or perhaps you only use it two or three weeks out of the year at your vacation home. Do you really need to keep car insurance on this car?

The answer is “yes,” but you might be surprised at how cheap you can get a policy which will protect you any time you drive the car, and  prevent you from being in violation of state ordinances regarding liability protection on automobiles.

Car insurance companies have long recognized that people who drive cars only occasionally, for a variety of reasons, are good insurance risks and have hastened to provide them with low-cost policies. Examples of people who drive infrequently might be older drivers who only take the car to the store once a week; collectors who only drive cars to car shows; and military service people who must store their cars for long periods of time.

No matter what your reasons for driving infrequently, you are in luck when it comes to finding cheap car insurance. There are several ways policies are set up for infrequent drivers, and you can easily choose which one is right for you.

Storage Car Insurance

If you car is stored and never driven, except to move it from one storage facility to another, for example, you might want to look at a true “storage” policy. These policies have very stringent requirements about what is covered and exactly how much the vehicle can be moved, but they are also usually the cheapest form of auto insurance available. These are good policy choices for stored or antique vehicles, as well. Be sure to talk to the agent about both liability coverage, in case someone is injured on or around the car, and comprehensive coverage which will take care of fire damage or theft.

If you do drive the car minimally, it is a good idea to look at one of two types of policies: collector car insurance and “pay-as-you-drive” insurance. While each type of policy serves a slightly different purpose, it is likely that one or the other will be perfect for your needs.

Collector Car Insurance

Collector car insurance, as the name implies, is coverage for those who have collectible or antique cars which are actually driven. There are several companies which specialize in collector car insurance: Hagerty, Grundy, and Chubb are just a few. Collector policies can be “agreed price,” which means you pay for a certain amount of coverage no matter what the car’s value, or it can be based on the actual value of the car. Most collectors urge their colleagues to go with agreed price insurance, because you can account for modifications and parts you have added to the car without the insurance company’s adjustor being involved and possibly denying your higher claim amount.

Pay as your Drive Insurance

Pay-as-you-drive insurance is based on the idea that, if you pay for a six-month premium with unlimited mileage, you are actually buying a lot of insurance you do not need. Instead, pay-as-you-drive policies calculate premiums based on the actual number of miles you put on your car in a given time period; the less you drive, the less you pay.

Pay-as-you-drive insurance policies have been springing up at several large insurers, and with today’s technology it is becoming easier to administer these types of policies. Progressive, for instance, has an “instant snapshot” feature which allows you to attach a wireless monitoring device to your car. Not only does it record your mileage, but it also records your driving habits, which can lower your monthly premiums. If you sign up for pay-as-you-drive with Progressive or another company, your premiums will be based on the amount you actually drive, not on a “set” amount for your age group, location, and car type. This can allow you to save significant money on your premiums during times you are not using your car.

Case Studies: Exploring Car Insurance Options for Occasional Drivers

Case Study 1: Storage Car Insurance

Suppose you have a car which is stored the majority of the time. You only take it out once a month to drive it around the block and keep it running, or perhaps you only use it two or three weeks out of the year at your vacation home.

In this case, a true “storage” policy may be the right choice. These policies, designed for stored or antique vehicles, have stringent requirements about coverage and vehicle movement. However, they are usually the cheapest form of auto insurance available.

Case Study 2: Collector Car Insurance

For individuals who own collectible or antique cars that are actually driven, collector car insurance is a suitable option. Companies specializing in collector car insurance, such as Hagerty, Grundy, and Chubb, offer coverage based on agreed price or the actual value of the car.

This type of insurance allows collectors to account for modifications and added parts without complications from insurance adjusters.

Case Study 3: Pay-as-You-Drive Insurance

Pay-as-you-drive insurance is a viable choice for individuals who drive minimally. These policies calculate premiums based on the actual number of miles driven within a specific time period. The less you drive, the less you pay.

Some insurers, like Progressive, offer monitoring devices that record mileage and driving habits, allowing for potential discounts based on safe driving behavior. Pay-as-you-drive insurance can provide significant savings on premiums when the car is not in use.

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