Insurance companies in Australia don’t offer specific short-term car insurance products. Policies are generally sold on an annual basis, meaning you take out cover for a full year – even if you only need it for a shorter time.
However, if you're only after cover for a limited period or want a more flexible policy, there are still options available.
Short-term car insurance options
While you can’t take out temporary car insurance, there are flexible ways to get cover when you don’t need it long term. Depending on your situation, here’s what you could do:
-
Take out a standard policy and cancel when you no longer need it
Car insurance policies in Australia typically run for a full year, but you’re entitled to cancel at any time. You can take out a standard policy and cancel it once you no longer need cover, whether you’ve paid the full premium upfront or in monthly instalments. Unless specified otherwise, your policy will start from the day you buy it, so you're covered immediately. If you cancel outside the cooling-off period, you may be charged a cancellation fee, but you can still get a refund on the unused portion of your premium.
-
Add yourself as a listed driver
If you’re borrowing someone else’s car for a short time, you may be able to avoid taking out your own policy by being added as a listed driver on theirs. This can be ideal for short-term use of a friend or family member’s vehicle. Keep in mind that this could raise their premium and, if you're an unnamed driver, a higher or additional excess may apply if you cause an accident.
-
Rent a car
When you need a vehicle for just a few days or weeks, hiring can be a practical short-term solution. Rental agreements usually include basic insurance, but this often comes with a high excess and limited cover. To reduce your out-of-pocket risk, you can take out separate car hire excess insurance, which covers you for damage to the vehicle while it’s in your care and is typically charged by the day.
-
Consider a pay-as-you-drive policy
If you don’t drive often but still want comprehensive cover, a pay-as-you-drive (PAYD) policy may be worth exploring. These policies base your premium on the distance you drive, offering a more cost-effective option for low-usage drivers. You’ll usually nominate a set number of kilometres for the year, and your premium is calculated accordingly. While PAYD policies are still annual contracts, they can suit those who need flexible, lower-cost insurance without sacrificing cover.
When might you need short-term car insurance?
Short-term car cover can make sense in certain one-off or temporary situations. You might find yourself needing flexible insurance if:
-
You're in between cars
Maybe you’ve sold your old vehicle and are borrowing one while you shop around. Temporary cover can bridge the gap without locking you into a long-term policy. -
You’re test driving or picking up a new vehicle
If you’re driving a car home after buying it, or taking one for an extended test drive, you’ll need valid insurance for the trip – even if it’s just for a day. -
You’re borrowing a car
Whether you’re using a friend’s car for a weekend or helping someone move, short-term arrangements like being added to their policy as a listed driver could cover you for the brief stint behind the wheel. -
You’re driving a second car occasionally
If you have a car you only use seasonally or for certain trips, you might prefer an option that lets you save money when it’s off the road. -
You’re not a frequent driver
If your car spends more time parked than moving, a PAYD policy could keep you covered without paying for distance you’re not using. -
You’ve hired a car
Insurance is usually bundled into rental contracts, but it’s often basic. You may need extra cover to avoid costly excesses if something goes wrong.
Can I get a cover note for short-term car insurance?
No – cover notes are no longer available in Australia. These were temporary car insurance policies that provided short-term cover to drivers until a full policy could be arranged. Typically ranging from a few days to a few weeks, the cover note protected against third-party claims in the event of an accident.
Today, cover notes have been phased out and replaced by instant car insurance, which come with a cooling-off period. During this time – usually the first 14 to 30 days of your policy – you can cancel your cover for a full refund, provided no claims have been made.
Cooling-off periods effectively serve the same purpose as cover notes once did: giving you immediate cover while still allowing flexibility if you change your mind. You can switch policies or insurers without penalty, making it easier to find the right fit for your needs.
How do I compare short-term car insurance policies?
Because short-term coverage often involves taking out and later cancelling a standard policy, it’s important to carefully review the provider’s terms and conditions. When comparing, consider:
- Coverage type: make sure the policy offers the level of protection you need for the period you require.
- Payment flexibility: look for policies offering monthly or fortnightly payments so you don’t have to pay for a full year upfront.
- Cooling-off period: this can vary between provider so it’s important to determine exactly how long you have to cancel your policy without having to pay a fee.
- Fees: make note of cancellation fees or extra charges that could affect the overall cost.
- Refund policy: check how refunds on unused premiums are handled and how quickly they’re processed after cancellation.
- Excess amounts: pay attention to the excess, as a high excess can mean significant out-of-pocket costs if you need to make a claim during your short coverage period.
- Customer service: look at reviews or ratings for how easy it is to manage your policy or make a claim, as this can matter if you need quick support.
Understanding these factors helps you find the most cost-effective and flexible option for your situation. With Savvy, you can compare policies side-by-side, so you’re confident you’re getting the right coverage and price for your short-term needs.
