Yes, as long as you have the card owner's permission, you can pay the deposit for your car insurance policy or in full with your credit or debit card. Yes, you can generally pay for your car insurance with a credit card, and by doing so, you can get certain benefits, such as cash refunds or other credit card benefits. Due to the prevalence of insurance applications and e-commerce, paying for insurance with a credit card is common. However, it may come with some risks, depending on your situation.
You can pay for car insurance with a credit card, but it can come at an additional cost. The top 10 auto insurance companies accept credit card payments, as well as bank transfers, paper checks and money orders. However, insurers will charge a credit card processing or convenience fee, usually a percentage of the payment amount between 1.5% and 4%. Most major auto insurance companies accept credit cards as a form of payment.
Paying with a credit card can earn you reward points and give you more time to make payments, but it can also result in additional fees and debts. Before buying insurance at the counter, check if you're covered by your personal auto insurance policy or by your credit card. Here's what you need to know if you're thinking about making your car insurance payments with a credit card. Paying your annual car insurance payment up front can also earn you other discounts, so if you can afford it, it might be a smart choice.
Nearly all major insurance providers now allow you to pay your insurance premium by credit card, debit card, electronic check, or electronic fund transfer (EFT), all of which can offer the benefit of automation. However, before you decide to include your car insurance premiums on your credit card, you should determine if this is the best option for your budget. The final insurance policy premium for any policy is determined by the insurance company upon application. That said, if you're in control of your finances and make sure you pay your credit card balance in full and on time, then it might make sense to include car insurance payments on your credit card.
Most travel rewards cards come equipped with special car rental insurance that allows you to bypass the rental company's insurance. If you rent a car but don't have your own car insurance, your credit card company may offer a certain amount of car insurance coverage for the rental. But before you make the monthly payment on your credit card, check if your car insurance company charges you additional fees for paying by card. It's not necessarily bad to pay for your car insurance with your credit card, as long as you can pay your credit card in full and on time.
Kara McGinley was a senior editor and licensed home insurance expert at Policygenius, where she specialized in homeowners and renters insurance. In addition, paying bills such as mortgage or car insurance with credit cards can adversely affect your credit rating due to high credit utilization (the part of the total credit limit you use). Most credit cards offer secondary coverage, meaning that the coverage takes effect after the personal auto insurance policy.