Can You Pay Car Insurance With a Credit Card?
You can pay for almost anything with a credit card in today's world, and that includes your car insurance. Most car insurance companies will allow you to pay your insurance premium with a credit card and even offer flexible payment options. You may face a convenience fee, but if you're able to pay your credit card bill in full each month, paying your car insurance with a credit card could earn reward points and cash back on your purchases.
How Do You Pay for Car Insurance With a Credit Card?
Most car insurance companies make it easy to pay with a credit card, and they offer a variety of ways to do so. As with most bills, you can pay online, over the phone, through the company mobile app or even instantly when you request a free quote online. If you're able to pay your car insurance bill in one payment as opposed to monthly, you'll likely receive a discount on your insurance premium. You'll probably have a choice of the following payment options when you pay your car insurance with a credit card.
Online payments: You can use the car insurance company website to make a secure payment online. You can choose to pay your premium in installments or in full.
Paying over the phone: You can call your insurance company and provide your credit card number to the billing representative over the phone.-
Mobile app payments: Most car insurance companies offer a mobile app. You can download the app and set up your car insurance payments via the mobile app.
Pay-in-full discount: If you pay your bill in full, most insurers will offer a paid-in-full discount. Even if you can’t afford the whole bill up-front, using your credit card can provide more time to pay off the bill, as long as you have a low interest rate.
Automatic monthly payments: Automatic monthly payments allow you to “set it and forget it,” so you never miss a payment. You can usually set up automatic payments online, over the phone, or using your car insurance company’s mobile app.
Which Car Insurance Companies Accept Credit Cards?
Nearly every car insurance company accepts credit cards as a form of payment, including some of the largest and most popular companies in the U.S. Some companies may charge a convenience fee for using a credit card, so it’s important to check for that information. According to the National Association of Insurance Commissioners, the following companies have the largest market share in the U.S. and allow you to pay car insurance with a credit card.
Most large insurance companies in the U.S. provide credit card payment options, including some of the most familiar names in car insurance:
- [Allstate] (https://www.moneygeek.com/insurance/auto/reviews/allstate/)
- [USAA] (https://www.moneygeek.com/insurance/auto/reviews/usaa/)
- [Liberty Mutual] (https://www.moneygeek.com/insurance/auto/reviews/liberty-mutual/)
- [Farmers Insurance] (https://www.moneygeek.com/insurance/auto/reviews/farmers-insurance/)
- [Nationwide] (https://www.moneygeek.com/insurance/auto/reviews/nationwide-insurance/)
- [Travelers] (https://www.moneygeek.com/insurance/auto/reviews/travelers/)
- [American Family] (https://www.moneygeek.com/insurance/auto/reviews/american-family/)
Companies That Accept Credit Card Payments and Have Low Rates
If you're wondering how to reduce your car insurance cost, some car insurance companies that accept credit card payments also offer low insurance rates. While USAA is often the most affordable option, it's available to military members, veterans and their families only. However, the following companies offer the cheapest car insurance rates and will allow you to pay car insurance with a credit card.
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Should You Pay Your Car Insurance With a Credit Card?
Paying car insurance with a credit card comes with pros and cons. If you’re a responsible credit card user it could pay off to go this route. Knowing the risks of using a credit card to pay your car insurance can also help you determine whether using plastic is the right choice for you.
Credit card rewards: Many credit card companies offer reward points when you pay off your credit card. These points can be redeemed for travel, cash and other expenses.
Convenience: It's easy and convenient to pay your insurance with a credit card. You can set up automatic monthly payments, so you don't have to think about your premium each month.
More time to pay: If you need some extra cash in a crunch, paying with a credit card gives you more time to pay your bill.
Pay in full: Most car insurance companies offer a discount for paying your bill in full. If you don’t have the available funds to pay your bill in full, a credit card enables you to pay your car insurance payment on time and gives you more time to pay off the amount.
Save time: Credit card payments are made instantly, saving time on mailing your payment via mail or money order.
Fees: While most companies offer a discount for paying your insurance in full, most will also charge installment fees for paying your bill in monthly increments. This rate can range from $2–$15 and depends on which insurance company you use and where you live. Major companies like Geico, Allstate, State Farm, Progressive and others might charge installment fees in your state.
Interest rates: If you don't pay off your credit card in time, you'll pay interest on the amount you owe. Interest can get pricey, which is why it's always best to shop for a low-interest credit card.-
Increased debt: Credit card debt can add up quickly. If you put your car insurance premium on your credit card and can't pay it off, you'll increase your debt.
Negative credit score: Continually maxing out your credit card or purchasing near its limit can have a negative impact on your credit score.
Credit cards are a useful and powerful tool for building credit and earning rewards when used wisely. For consumers who typically pay them off each month, it makes sense to use a credit card to pay for car insurance. When deciding if you should use your credit card in this way, you'll want to weigh the pros and cons to determine if it's a smart move for you.
About the Author
- Car and Driver. "Can You Pay Auto Insurance With a Credit Card?." Accessed June 12, 2020.
- National Association of Insurance Commissioners. "National Association of Insurance Commissioners Property and Casualty Insurance Industry 2019 Top 25 Groups and Companies by Countrywide Premium." Accessed June 12, 2020.
- The Truth About Insurance. "Five Insurance Fees To Watch Out For." Accessed June 12, 2020.