Can You Pay Car Insurance With a Credit Card? (2023)

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.

Can You Pay Car Insurance With a Credit Card? (1)

Methodology

Why Trust MoneyGeek? MoneyGeek gathered data from Quadrant Information Services and state departments of insurance to determine the average cost of car insurance. We included research from reputable resources such as the National Association of Insurance Commissioners and utilized our multi-step editorial process that includes expert analysis and fact-checking.

Can You Pay Car Insurance With a Credit Card? (2)

Compare Auto Insurance Rates

Ensure you are getting the best rate for your car insurance. Compare quotes from the top insurance companies.

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?

Can You Pay Car Insurance With a Credit Card? (3)

State Farm

State Farm provides convenient payment options for customers using a credit card. You can make a one-time online payment, create an account or contact a State Farm agent to pay for your car insurance using a credit card.

Can You Pay Car Insurance With a Credit Card? (4)

GEICO

GEICO has a variety of credit card payment options to meet your needs, including automatic payments, customized payment installments and other paperless payment methods.

(Video) Can you pay car insurance with a Credit Card

Can You Pay Car Insurance With a Credit Card? (5)

Progressive

Progressive customers can make credit card payments online or through the mobile app. Progressive offers automatic payments in addition to one-time payments.

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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Can You Pay Car Insurance With a Credit Card? (6)

  • Company

    Amountper year

  • 1

    .

    GEICO

    $1,047

  • 2

    .

    (Video) Yes, your credit score does factor into how much you pay for your car insurance

    State Farm

    $1,235

  • 3

    .

    Nationwide

    $1,341

  • 4

    .

    Allstate

    $1,351

  • 5

    .

    (Video) Which Bills Can You Pay with a Credit Card? Plastiq Guide 2019

    Progressive

    $1,381

  • 6

    .

    Travelers

    $1,525

  • 7

    .

    Farmers

    $1,578

  • 8

    .

    MetLife

    (Video) Rental Car Insurance: What your credit card does and doesn't cover

    $1,686

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.

Pros

  • 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.

Cons

  • 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.

Can You Pay Car Insurance With a Credit Card? (7)

Compare Auto Insurance Rates

Ensure you are getting the best rate for your car insurance. Compare quotes from the top insurance companies.

About the Author

Can You Pay Car Insurance With a Credit Card? (8)

Can You Pay Car Insurance With a Credit Card? (9)

Sara East is a freelance writer and content marketing professional based in Reno, NV. She has more than 10 years marketing experience in public relations, content and digital marketing. Sara has been a published writer for more than 10 years having written articles about finance, business, entrepreneurship, education, travel, real estate, insurance, healthy living, social media, travel and study abroad.

Sara's writing has been published in national news sites including Mashable, The Muse and The Next Web as well as on a variety of blogs. When she's not writing, Sara enjoys spending time with her fur kids exploring the mountains of Reno/Tahoe and enjoying the outdoors.

sources

FAQs

Is it best to pay car insurance in full? ›

If you can afford to pay for your car insurance in one go, that is almost always cheaper than choosing to pay monthly car insurance. That's because, by paying a lump sum upfront, you avoid entering into a credit agreement that involves paying interest on the premium calculated by the insurer.

Is car insurance classed as credit? ›

Car insurance companies don't report your premium payments to the credit bureaus, so your policy doesn't appear on your credit report. As with other types of accounts such as utilities and medical bills, however, your insurer may send an unpaid balance to a collection agency if you stop paying your bill.

Is it better to pay insurance monthly or annually? ›

It's cheaper to pay for car insurance annually, because there is one upfront payment, with no added extras. Paying monthly is not a case of splitting your annual cost into 12 monthly payments. When you pay upfront, insurers get paid in full for their policy, and that's the end of the matter.

What is the best way to pay car insurance? ›

Payment Methods
  1. EFT. EFT, or electronic funds transfer, is often considered the best and most convenient way to pay your car insurance premiums. ...
  2. Debit Card. ...
  3. Credit Card. ...
  4. Cash. ...
  5. Check. ...
  6. Benefits of Paying Car Insurance with a Credit Card. ...
  7. Downsides of Paying Car Insurance with a Credit Card.
4 Jun 2021

Is 100 a month for car insurance good? ›

It's definitely possible to get liability-only coverage for less than $100 per month. This is the minimum level of coverage required by most states and is generally the least expensive type of insurance to carry on your vehicle.

Can you pay car insurance premiums with credit? ›

Individuals can pay their insurance premium payments through a number of methods such as internet banking, auto-debit and also through credit cards and debit cards.

Is it better to pay car insurance monthly or every 6 months? ›

Paying your car insurance premium in full every six months will save you money. Depending on the insurance carrier, this could reduce your premium substantially compared to monthly payments.

Does insurance hurt credit? ›

It is true that insurance companies check your credit score when giving you a quote. However, what they're doing is called a 'soft pull' — a type of inquiry that won't affect your credit score. You'll be able to see these inquiries on your personal credit reports, but that's it.

Why is car insurance so expensive? ›

The state's combination of densely-populated urban centers, high healthcare costs, pricey auto repairs and severe weather and natural disaster risks all contribute to California's higher-than-average insurance premiums.

Can someone else pay my car insurance monthly? ›

Yes, so long as you have the card owner's permission, you can pay the deposit for your car insurance policy or in full using their credit or debit card. However, any monthly Direct Debit payments must be taken from an account held in your name.

Is insurance cheaper if you pay every 6 months? ›

In most cases, a six-month policy is going to be cheaper than a 12-month policy because you are paying for coverage over a shorter period of time. However, if you compare your car insurance price on a monthly basis, it may not be much different between a six-month policy and a 12-month policy.

What are 3 ways you can lower the cost of your auto insurance? ›

Here are some ways to save on car insurance1
  • Increase your deductible.
  • Check for discounts you qualify for.
  • Compare auto insurance quotes.
  • Maintain a good driving record.
  • Participate in a safe driving program.
  • Take a defensive driving course.
  • Explore payment options.
  • Improve your credit score.

Is car insurance cheaper once paid off? ›

Car insurance premiums don't automatically go down when you pay off your car, but you can probably lower your premium by dropping coverage that's no longer required.

Who pays the most for car insurance? ›

Who pays more for car insurance, men or women? For the most part, men and women pay about the same amount for car insurance. For typical adult drivers, we found only a slight difference in the cost of insurance between men and women. We found a price difference of less than 1% between men and women in their 30s.

Is 300 a month a lot for car insurance? ›

Yes, $300 a month for car insurance is expensive. The average cost of car insurance ranges from about $60 per month for state-minimum coverage to $166 per month for full coverage, though individual car insurance rates vary based on factors such as driving record, age and location.

How Much Is Most car insurance a month? ›

The average cost of car insurance is $1,771 per year for full coverage, or about $148 per month, according to Bankrate's 2022 analysis of average quoted premiums from Quadrant Information Services.

What is the average monthly car payment? ›

If you're in the market for a new car, you might be asking yourself — how much is the average car payment? Experian reports that, as of the third quarter of 2021, new vehicle owners paid an average of $617 a month on their vehicles, while used car owners paid $471.

What credit cards pay for car insurance? ›

Most major insurance companies accept credit cards — including Visa, Mastercard, and American Express — as payment for your premiums. Paying the total car insurance premium for the year could save you up to 20% since many insurers discount annual premium payments.

Can I use a credit card to pay my car payment? ›

Another way to pay your auto loan is to use a balance transfer credit card. If you have a high enough credit limit, you could transfer your entire auto loan balance to a credit card. However, most credit card companies charge a 3 percent balance transfer fee (or a flat rate).

What bills can you pay with credit card? ›

The short answer is, entertainment and nonessentials can usually be paid with a credit card with no fees. Services, utilities, and taxes, can often be paid with a credit card but with a processing fee. Loan payments, are usually check or bank withdrawal payment only.

Is yearly car insurance cheaper than monthly? ›

But paying annually does have its benefits, including: Your insurer may offer you a discount of around 7% on the total cost, therefore, you'll save funds on the total cost of your policy. You won't have to pay any administration fees associated with paying in monthly installments.

What does it mean when your auto policy is paid in full? ›

"Paid," or "paid in full," is the term applied to installment accounts, like car loans, after the last payment is made and you have completed repayment of the loan as agreed.

What is a 12-month premium? ›

When you opt for 12-month insurance, your rates are secured for a year. Depending on your driving record, this could be an advantage or a disadvantage. For example, if you're in an accident, most insurance providers will increase your rates for up to three to five years.

Does missing car insurance payment affect credit score? ›

Your credit score can drop: If you owe money on your car insurance and your insurer passes the debt to a collection agency, it will likely impact your credit score. This can affect your ability to get a credit card or loan, and the derogatory mark will remain on your credit report for up to seven years.

What is a good credit score? ›

Although ranges vary depending on the credit scoring model, generally credit scores from 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent.

Does insurance increase credit score? ›

The simple answer is no. Getting a car insurance quote won't affect your credit rating at all. However, it must be said that insurance companies use a range of factors to assess your risk and determine if they'll give you a policy, as well as the premium that you'll pay.

At what age does car insurance go down? ›

On average, drivers will see their premiums begin to fall around age 25. This reflects the lower risk posed by drivers in their mid-20s as they gain driving experience and maturity, compared to a 17-year-old who has just passed their test.

What is most important when getting car insurance? ›

The most important coverage has to be your state's minimum liability and property damage coverage. More than anything else, you need to maintain car insurance to keep yourself legal to drive. You risk losing your driver's license and fines driving without it.

Is car insurance a good idea? ›

Protect Yourself and Others – The right car insurance can help protect you, your family members, your passengers and other drivers. If an accident happens, you want to know you have the right coverage to take care of any property or bodily injury costs that may arise.

Can you drive someone's car on your own insurance? ›

No. There was a time when many fully-comp policies automatically gave you third-party insurance to drive any car, but those days have gone. So even if you're fully covered for your own car, don't assume you're insured to drive other people's cars otherwise you risk breaking the law.

Can two people pay insurance on the same car? ›

Yes. As long as all drivers are listed on the policy and someone pays the bills, you shouldn't have a problem sharing car insurance with multiple drivers. Your monthly premium will reflect the added risk of multiple drivers using one vehicle — so you'll most likely pay more than you would for a single-driver policy.

Can I cancel my car insurance if I pay monthly? ›

Can I cancel my car insurance if I pay monthly? Yes. Plenty of people choose to pay their car insurance monthly, and there's nothing to stop you from cancelling. Just tell your insurance provider that you want to cancel and they'll arrange it for you.

Is $200 a month a lot for insurance? ›

Yes, $200 a month for car insurance is fairly expensive, especially for minimum coverage. The average cost of car insurance ranges from about $60 per month for state-minimum coverage to $166 per month for full coverage.

Can you cancel car insurance anytime? ›

Yes, most car insurance policies allow policyholders to terminate coverage at any time. Cancellation typically requires a signed form or written notice of cancellation that includes the desired end date of the policy. You may have to pay a cancellation fee as well in rare cases.

How much should you budget monthly to cover your insurance? ›

Set aside enough money monthly

For example, if your home insurance is $900 every six months, set aside $150 every month. It's much easier to budget for $150 than it is to come up with $900 all at once.

What happens when you pay your insurance in full? ›

When you pay your full premium, you're paying for the months ahead. Its money out of your pocket and into the coffers of the insurance company before you drive and before you could file a claim.

Is it better to pay in full or monthly? ›

If you regularly use your credit card to make purchases but repay it in full, your credit score will most likely be better than if you carry the balance month to month. Your credit utilization ratio is another important factor that affects your credit score.

Is it better to pay upfront or monthly? ›

Lump sum makes sense if you can comfortably afford it and want to save in the long term. On the other hand, you should pay in installment payments if you don't have enough money upfront and you're more comfortable with a consistent monthly payment.

How can you bring down the cost of your insurance? ›

Here are some ways to save on car insurance1
  1. Increase your deductible.
  2. Check for discounts you qualify for.
  3. Compare auto insurance quotes.
  4. Maintain a good driving record.
  5. Participate in a safe driving program.
  6. Take a defensive driving course.
  7. Explore payment options.
  8. Improve your credit score.

Is it better to pay out of pocket or insurance? ›

If the cost to repair your car will cost less than your deductible, or even just slightly more, you should handle the repairs out of pocket. For example, if the damage to your car costs $300 to fix and the deductible is $200, you would save $100 by filing a claim.

Is it worth shopping around for car insurance? ›

Certain factors affect your auto insurance rates, but you can always shop around for better prices, especially if you've been a safe driver and your age is within the range of stability in prices.

Is it cheaper to pay car insurance every 6 months? ›

In most cases, a six-month policy is going to be cheaper than a 12-month policy because you are paying for coverage over a shorter period of time. However, if you compare your car insurance price on a monthly basis, it may not be much different between a six-month policy and a 12-month policy.

Does your credit go up when you pay insurance? ›

The short answer is no. There is no direct affect between car insurance and your credit, paying your insurance bill late or not at all could lead to debt collection reports.

What balance should I keep on credit card? ›

The general rule of thumb has been that you don't want your CUR to exceed 30%, but increasingly financial experts are recommending that you don't want to go above 10% if you really want an excellent credit score.

What happens if I pay my credit card early? ›

Paying your credit card early reduces the interest you are charged. If you don't pay a credit card in full, the next month you are charged interest each day, based on your daily balance. That means if you pay part (or all) of your bill early, you will have a smaller average daily balance and lower interest payments.

Why did my credit score go down when I paid off my credit card? ›

Why credit scores can drop after paying off a loan. Credit scores are calculated using a specific formula and indicate how likely you are to pay back a loan on time. But while paying off debt is a good thing, it may lower your credit score if it changes your credit mix, credit utilization or average account age.

Does your monthly payment go down if you pay extra? ›

Making your normal monthly payments will pay down, or amortize, your loan. However, if it fits within your budget, paying extra toward your principal can be a great way to lessen the time it takes to repay your fixed-rate loan and the amount of interest you'll pay. Related topics: Homeownership.

Is it better to have money or credit? ›

Paying with cash vs. credit helps you keep your debt in check. It can be easy to get into debt, and not so easy to get out of it. In addition to paying more in total for purchases over time, you're also accumulating more debt if you don't pay your bills off from month to month.

Is it better to borrow or save money? ›

Spending your savings is much better than borrowing money in many ways as you are free from the stress of monthly EMIs and are also not indebted to anybody. Here are some other advantages of using your own savings: Eliminates interest.

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