A car is an asset that needs protection from various risks such as damage, bodily injury, and other liabilities. In case of such risks, an insurance policy is purchased to provide security against involuntary financial loss. The insurance policy is a written contract between the insurance company and the person or company buying the insurance cover. To contact a good insurance provider, you should research various insurance companies and their online reviews to ensure financially stable companies. As per the Motor Act, third-party insurance is unavoidable, and you have to purchase the insurance whether you acquire a new motor vehicle or one that has been in use. There are two types of insurance:
- regular vehicle insurance
- temporary vehicle insurance
Regular vehicle insurance is the mandatory insurance every vehicle owner should have.
Temporary insurance is a policy that is bought for a short period. One-day insurance is an example of a temporary insurance policy.
Below are instances of why someone can opt to take one-day insurance.
- Driving a borrowed car- There are a lot of cases that might arise for someone to borrow a vehicle. Such instances include emergencies or just for any other purpose, such as going on a vacation with your family. Borrowing and driving someone else’s car is a common thing worldwide. Therefore, after borrowing a car, before moving it, it is necessary to take one-day insurance if you are not listed as one of the drivers for that vehicle. This is done by contacting the vehicle’s recent insurance providers to add you to their policy for only one day.
- Driving a rental car- Leasing an auto is renting a vehicle for a specific amount of time for an agreed amount of money. People rent cars for business or personal reasons, which both reasons have their benefits. Vehicles can be rented from an individual or a company. Most companies have insured their “vehicles for rent”; thus, it is effortless to contact their insurance company and add you to the policy. If the car is being rented from an individual, the procedure of acquiring a one-day insurance is the same as that of borrowing a vehicle. In addition, the person borrowing the vehicle can add additional coverage to protect from liabilities that are not accounted to the primary insurance policy.
- Insuring a classic car- Most classic cars are cars that are kept in garages or stored for driving on special occasions. Other cars that are just held, and the owner decides to take a ride on them can also be termed classic cars. Most rich people have many vehicles, and they opt not to insure them because it is costly to pay a large amount of money used to pay for the monthly premiums. Therefore, they opt to fully insure 2 or 3 vehicles used often, and the rest would take temporary insurance if they were to be used.
- Test driving a car- Most dealerships are obligated to purchase insurance for the vehicles on sale. So, if you are taking a dealership car for a trial, the cars are already insured, so you don’t need to purchase insurance. However, private sellers are not obligated to buy insurance for the ‘vehicles on sale,’ so ensure to insure it for a day if you decide to take it for a test.
- Usage-based insurance policy, it is a policy that favors vehicles that are driven once in a while. Most insurance policies don’t contain this kind of policy in their standard manual, but it is added for any individual or company that may need it. It involves charging the vehicle owner by the days the car is in use. They calculate the fee depending on how frequently and safely you drive the vehicle.
- Self-insurance-Some people insure their vehicles using personal money rather than purchasing an insurance policy. It is a rare occurrence accepted and approved in a few states. In case of damages, accidents, and other liabilities, the vehicle owner pays for everything, including damages and injury to another vehicle. It is a costly option, but it is the best policy for drivers who drive carefully and can afford the expenses. This type of policy is called self-insurance.
- Buying a car that you will resell relatively briskly- Brokers are business personnel that buys assets at a lower price and sell the vehicles at a slightly high price. In such cases, the broker might opt to purchase one-day insurance for the vehicle so that they take it to the other buyer.
Temporary insurance is an expensive policy. Some companies contain better deals on this policy, but it is one of the factors that affect prices in the insurance sector. Temporary insurance has its advantages, and depending on your plans before purchasing it, it can be of high benefits.