7 Day Car Insurance in Michigan: Everything You Need to Know

Michigan used to allow drivers to purchase 7-day car insurance policies. These short-term policies provided temporary coverage while drivers shopped for long-term insurance plans.

However, 7-day policies were banned in Michigan in 2019. This ban aimed to stop drivers from using 7-day insurance illegally.

So what do Michigan drivers need to know about 7-day car insurance now? This guide covers:

• What is 7-day car insurance?
• The history of 7-day policies in Michigan
• Why 7-day insurance was banned
• How much 7-day insurance used to cost
• Alternatives for temporary coverage
• How to get cheap car insurance in Michigan

What is 7-Day Car Insurance?

7-day car insurance provided exactly what its name implies – auto insurance coverage for one week.

These short-term policies were intended to give drivers time to shop for long-term coverage. They provided immediate proof of insurance, which allowed drivers to legally register their vehicles.

7-day policies offered basic liability and personal injury protection coverage. This included:

• $20,000 per person and $40,000 per accident in bodily injury liability
• $10,000 in property damage liability
• Personal injury protection up to policy limits

Full comprehensive and collision coverage were not included.

The legal purpose of 7-day insurance was to provide temporary coverage while securing a standard policy. Holding a 7-day policy allowed drivers to legally drive while comparing quotes from different insurance providers.

However, these policies were often misused. Many drivers would purchase 7-day insurance to register their vehicle, then let their coverage lapse after a week. This allowed them to drive uninsured, which is illegal.

The History of 7-Day Car Insurance in Michigan

Michigan long had some of the highest car insurance rates in the country. Costs were driven up by the state’s unlimited personal injury protection (PIP) coverage.

PIP covers medical expenses for injuries sustained in an accident, regardless of fault. In Michigan, there were no caps on how much PIP insurance would pay out.

With such expensive baseline coverage, many Michigan drivers could not afford comprehensive insurance policies. Some turned to 7-day insurance as a stopgap measure.

7-day policies provided a way to register a vehicle and drive it legally for a short time. L.A. Insurance was the only provider offering these temporary plans in Michigan.

However, too many motorists were using 7-day insurance improperly. They would purchase coverage just long enough to get license plates and registration. Then they would let it lapse while continuing to drive.

Estimates suggested up to 50% of drivers with 7-day insurance were uninsured after their first week. This led to a major uninsured motorist problem in Michigan.

Why 7-Day Car Insurance Was Banned in Michigan

In 2019, Michigan passed a series of auto insurance reforms that aimed to lower costs. One of these reforms was a ban on 7-day insurance policies.

This ban targeted the common practice of purchasing 7-day insurance, registering a vehicle, then driving uninsured after the policy expired.

Lawmakers and insurance providers saw 7-day policies as an easy way for drivers to ignore insurance requirements. The ban forced motorists to maintain continuous coverage.

Michigan also introduced stiffer penalties for driving without insurance. Police can now impound a car for up to 30 days if its owner cannot prove they have current coverage.

How Much Did 7-Day Car Insurance Cost in Michigan?

7-day car insurance premiums cost approximately three times more than a traditional 6-month policy. On average:

• A standard 6-month Michigan policy cost around $650
• 7-day insurance cost nearly $20 per day, or $140 per week

However, these are just estimates. Your actual 7-day insurance rates depended on factors like:

• Age: Young drivers paid more than older motorists
• Driving record: Drivers with accidents/violations had higher premiums
• Vehicle: Insuring a sports car was more expensive than a sedan
• Location: Urban areas like Detroit had higher rates than rural zip codes

So while 7-day insurance allowed short-term coverage, it came at a steep price. Drivers would save significantly by purchasing a full 6-month or 1-year policy.

Alternatives to 7-Day Car Insurance in Michigan

While you can no longer buy 7-day insurance in Michigan, some alternatives provide temporary coverage. These include:

Short-Term Car Insurance

Some insurers offer policies that are shorter than 6 months. For example, you may be able to purchase a 3-month term.

This allows flexibility if you only need coverage for a limited time. Just beware that short-term insurance can be more expensive per month than longer policies.

Usage-Based Car Insurance

Usage-based or pay-per-mile insurance bases rates partly on how much you drive. Your premiums are lower if you do not drive often.

This can be a good option if you are looking for temporary coverage and do not need to drive frequently. However, monitoring devices are required to track your mileage.

Non-Owner Car Insurance

Non-owner insurance provides liability coverage when you drive a car you do not own. It can apply to rental cars, borrowed vehicles, company cars, etc.

This policy will satisfy state requirements if you only need to legally drive specific cars once in a while. It does not provide coverage for damage to the non-owned vehicle.

Cancellable Policy

Some standard car insurance policies are cancellable, meaning you can terminate coverage mid-term if needed. Make sure to ask whether your policy can be cancelled before purchasing.

If so, you can drop coverage immediately when you no longer require insurance. Be aware that cancellation fees may apply.

How to Get Cheap Car Insurance in Michigan

While 7-day insurance is banned, there are ways to get affordable car insurance coverage in Michigan. Consider these tips:

• Shop around – Compare quotes from at least 5-10 different insurers to find the best rate. Rates can vary dramatically between companies.

• Maintain good credit – Insurers check your credit when setting premiums. Keeping your credit score high will help lower your costs.

• Ask about discounts – Take advantage of any discounts you qualify for, like good student, safe driver, low mileage, etc. This provides significant savings.

• Increase deductibles – Raising your deductible from $500 to $1,000 could reduce your premiums by up to 15-30%.

• Limit coverage – Consider dropping comprehensive and collision coverage if you drive an older vehicle. Liability-only policies are much cheaper.

• Buy bundled policies – Insure your home or other policies with the same provider as your car. Most insurers provide multi-policy discounts.

Following these tips can help you maximize savings while maintaining continuous legal coverage. Drivers should avoid the temptation to buy 7-day insurance as a shortcut. Purchasing adequate insurance is essential to protecting yourself on the road.