Why people buy 7-day insurance
There are two potential reasons to purchase 7-day policy. One is the official — and legal — reason it exists : that you will use the supernumerary time to find the best price you can on a full-length policy. But the army for the liberation of rwanda more common — and illegal — rationality people buy 7-day policy is to temporarily receive coverage while they renew their registration, then let coverage lapse subsequently .
In the latter case, you would buy a short-run policy in order to register your car with the express. then, once you ‘ve secured your license plates or update tabs, let your car policy lapse after the week is over. In theory, a driver could continue to purchase 7-day indemnity every week in order to maintain coverage, but this does n’t seem to be identical park, as the Michigan secretary of state found that about four in five people who buy 7-day car insurance do n’t renew their coverage at the end of the week .
In short, people buy — and then skip out on — 7-day coverage because they ca n’t afford regular car indemnity. Michigan is among the most expensive states in the nation for indemnity — with a combine average premium of $ 1,364 per year — because of its highly generous mandatary PIP coverage. But in Detroit, premiums can easily reach five times that amount or more : We found that Detroit drivers can expect to pay an amazing $ 6,197 per year for car insurance. Often, the upfront cost is disproportionately high, as insurance companies require drivers to make a big down requital at the startle of coverage.
Why you shouldn’t buy 7-day insurance to shop around
The nominal purpose of 7-day indemnity may sound logical, but it does n’t hold up to scrutiny, as 7-day insurance is vastly more expensive on a per-day basis than normal cable car insurance for about all drivers .
furthermore, even if you do intend to use the extra meter to shop for the cheapest quote, you ‘re still better off buying a normal car policy policy. This is because insurance companies will about always refund unused premiums if you switch companies partway through your policy. A few insurers do charge small fees if you cancel your policy early, but even a small remainder in monthly premium will typically eclipse the fee over meter and is about surely more cost-efficient than purchasing a one-week policy .
For model, suppose you buy an indemnity policy for the average Michigan rate of $ 1,364 per year. One week late, you cancel your policy in prefer of one that ‘s 10 % cheaper ( $ 1,228 ), and pay a $ 50 cancellation fee ( which is on the high end for a cancellation tip ). That works out to a entire annual cost of $ 1,280 .
On the other hand, if you pay $ 200 for a one-week indemnity policy and switch to the same $ 1,228 plan subsequently, your sum cost for the year is $ 1,404 — a $ 120 dispute .
The consequences of letting 7-day insurance lapse in Michigan
It ‘s illegal to drive without car policy in Michigan and buying a one-week indemnity policy, then letting it lapse is treated the like as not buying policy in the first place. If you ‘re caught driving without policy, you ‘re national to a finely of $ 200 to $ 500, and repeat offenders may even face imprison time.
furthermore, if you get in an accident in Michigan and are n’t covered by policy, you ‘re responsible for all the expenses of the accident, including the checkup bills of the other party. And this is true evening if the early party was completely to blame for the accident. So there ‘s a big risk involved in driving without insurance, even if you are a careful driver .
ultimately, insurance companies charge higher rates to drivers who have not had continuous coverage or who have recently let their coverage drop. indeed if you go without policy now, flush if nothing bad happens while you ‘re unprotected, you ‘ll be penalized former .
Who offers 7-day insurance in Michigan?
The entirely provider of 7-day insurance in Michigan is L.A. Insurance, which is based in Royal Oak and has 103 locations in most major cities around the state of matter, including Detroit, Lansing and Flint. however, the company does n’t provide on-line quotes for 7-day coverage, so the only way to get a quote is to call an agent or visit a location .
7-day indemnity tends to cost $ 200 to $ 300 or more from L.A. Insurance, or around $ 800 to $ 1,300 per month. In contrast, the average rate for a full-term car policy policy in Michigan is $ 254.91 per month. The average driver would spend 3.5 times more if they bought policy on a weekly footing, so you ‘re much more likely to save money by purchasing a full policy from an insurance company.
Alternatives to 7-day insurance
If you ‘re considering purchasing 7-day car insurance precisely to find the cheapest car indemnity rate, it ‘s better to spend an hour collecting quotes immediately to find your best rate. You can even do this on your smartphone at the car franchise or the DMV. And if you do happen to find a better policy rate after you sign up, most insurers let you cancel with minimal to no penalty .
no down payment insurance company For people who are considering 7-day insurance because they ca n’t afford to pay a wide car indemnity premium, look into a. No down payment coverage still typically costs more than typical policy over the course of the policy, but the amount you pay is spread more evenly over that time, minimizing how much cash you need at any prison term. additionally, you should constantly check with respective insurers for their best rates, as they vary significantly based on the provider. For case, in our cogitation of the best rates for cable car policy in Michigan, the most expensive insurance company, Allstate, charged more than five times ampere much for a class of coverage than the least expensive supplier, MetLife .