Michigan is one of the most expensive states to insure your car. This is due to its mandatory personal injuries protection and medical payments coverage as well as an increasing rate of claim fraud. It is illegal in Michigan to drive a vehicle without insurance. You must also be insured to renew your vehicle’s registration. Short-term policies like Michigan’s banned 7-day car insurance are becoming more popular.
Michigan offered 7-day car insurance. It only covered motorists for one week. These policies are no more available. However, understanding how they functioned and the alternatives can help you choose which car insurance is right for you.
What was 7-day auto insurance?
Michigan’s auto insurance costs are higher than the average price of auto coverage in the United States. LA Insurance was the only Michigan company that sold 7-day car insurance. This was to provide temporary coverage while consumers searched for long-term, affordable insurance. The coverage was only valid for a week, and it automatically expires if not renewed. Although 7-day insurance was more costly than regular car insurance for some Michigan drivers, it proved to be more convenient.
Many Michigan drivers bought this policy to meet vehicle registration requirements. However, the policy was canceled after seven days. This allowed many Michigan drivers to abuse the policy, maintain their car registrations while not having insurance to pay. A settlement was reached in which banned LA Insurance from selling more policies.
The 7-day policy was misused by enough Michigan drivers that the government was forced to ban the program. LA Insurance sells a 6-month policy which will expire 13 days after payment is not made. It functions in the same way as the 7-day insurance.
Alternatives to 7 Day Insurance
Michigan drivers no longer have 7-day car insurance. However, there are many other options that might be cheaper or more convenient than standard coverage. These are just a few options.
Car insurance for short-term
You can choose between a 6- or 12-month policy. However, you have the right to cancel any time you find a lower rate elsewhere. You might have to pay a cancellation fee. However, cancellation fees are often much less than for 7-day insurance.
Insurance based on usage
By driving fewer miles, you may be able get lower insurance rates. You can cancel or suspend your coverage with a usage-based plan if your vehicle is not being used for a prolonged period.
Minimal liability insurance
Many drivers choose to only purchase the minimum coverage required in Michigan because driving without insurance is against the law. Michigan’s minimum coverage is 50/100/10, which averages out to $995 per year. Drivers are encouraged to buy coverage that exceeds the minimum coverage requirements. The minimum coverage limits may not be sufficient to cover all expenses arising from an at-fault collision.
Questions frequently asked
Can I still purchase 7-day auto insurance in Michigan?
Michigan drivers are now unable to obtain 7-day insurance because these policies were prohibited. LA Insurance, an insurance company that originally offered 7-day policies to Michigan motorists, has now changed them with 6-month policies. These policies can expire in 13 days if they are not renewed.
When purchasing Michigan car insurance, there are many excellent auto insurance providers. Drivers looking for alternative coverage options may also consider usage-based and short-term car insurance.
Where can I find short-term coverage for my needs?
You can often find short-term car insurance in terms of six-months. These policies are more expensive than long-term auto insurance, so it is important to research the premiums to ensure you get the right price. However, Michigan’s auto insurance providers, USAA and Geico, offer six-month policies.
What are the advantages of short-term coverage
When you don’t need to be financially protected for a long time, a shorter insurance policy can help. Many students drive their cars to and from school during breaks. A temporary or short-term car insurance policy is a good option to ensure that they are adequately covered. Driving on vacation, or renting a car are two other examples. Talk to an agent to discuss your insurance needs.
