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What is Michigan 7-Day Insurance?

Learn about Michigan's 7-day car insurance policies: costs, legality, and alternative options.

seven day car insurance

7-day insurance used to be legal in Michigan, but it was recently banned in the state. It was made for drivers looking for long-term car insurance who needed temporary insurance in the meantime. However, many drivers paid for the week, registered their car, then let the insurance lapse and continued to drive with the registration. This was the common, but illegal, way to use 7-day insurance.

That misuse is why 7-day insurance is now banned and drivers in Michigan cannot purchase week-long policies. Luckily, there are alternatives to a seven-day policy for Michigan drivers, including temporary policies, usage-based insurance and non-owner car insurance.

What is a 7-day insurance policy?

7-day insurance was for drivers who couldn’t afford a standard policy and needed more time to shop for long-term insurance. This was a popular program, perhaps because Michigan has the highest average auto insurance rates in the country. However, these temporary policies were recently banned because of how drivers often misused them.

There were two ways to use 7-day insurance in Michigan, a legal and an illegal way. The legal purpose was to allow drivers a week of insurance while they shopped around for a long-term policy. However, many drivers chose to use 7-day insurance by registering their car, then allowing their insurance to lapse.They would let their week-long policy run out without purchasing a new one. Unfortunately, that means driving uninsured, which is illegal.

In Michigan, you face a fine up to $500 and even jail time if you’re pulled over while driving without insurance. That’s not considering the cost of involvement in an accident without insurance. If you don’t have insurance, even if the crash isn’t your fault, you are responsible for paying for property damage, medical bills and legal expenses. That’s why it’s important to have auto insurance if you’re on the road.

How much did 7-day insurance cost?

7-day insurance used to cost around three times more than a standard Michigan car insurance policy. You’ll actually save more by purchasing a standard policy as opposed to a short-term one.

According to our data, the average cost of car insurance in Michigan is $1,231 per year. Since 7-day insurance policies usually cost around three times more than a standard policy, that would be around $3,693 per year, or $10 a day. Your rates depend on several factors, including your driving history, credit score, ZIP code and more.

What company provided 7-day insurance?

L.A. Insurance was the only provider in Michigan that offered 7-day insurance. Now that seven-day insurance is banned, L.A. Insurance only offers six-month and annual policies.

Alternatives to a 7-day policy in Michigan

7-day car insurance policies are no longer available in Michigan. That means you need an alternative if you’re looking for something other than a standard policy. These are some options you should consider as a substitute for a 7-day policy:

Temporary or short-term car insurance

Are you looking for a policy that you aren’t obligated to keep until the end of a six-month or year-long period? If so, you should consider temporary car insurance. Temporary car insurance covers you for days or weeks. It isn’t marketed as a temporary policy, but you will purchase a six- or 12-month standard policy that allows you to cancel at any time. That way you can be covered for a few months instead of the full term. This type of policy is an option if you only need coverage for a short amount of time.

These are some issues with short-term car insurance you should consider:

  • If you don’t purchase an auto insurance policy before your temporary policy ends, you risk being uninsured. Driving uninsured is illegal in Michigan and may result in expensive fines and even jail time. A gap in coverage means higher premiums when you get car insurance again.
  • Canceling your policy early may mean being charged a cancellation fee by your insurer. Although you’re allowed to cancel early, the cost to do so may not be worth it.

Usage-based auto insurance

If you don’t drive enough to warrant an expensive auto insurance police, a usage-based planmay be a good fit. There are two types of usage-based car insurance plans: one that tracks the distance you travel and one that tracks how you drive. Insurance companies install a telematics device into a driver’s car to track the customer’s mileage and driving habits. Usage-based car insurance (UBI) is cheaper if you drive less and are a safe driver. The devices monitor these things:

  • How many miles are driven
  • How often the car is driven
  • The time of day the car is on the road
  • Speeding, hard braking and rapid acceleration

If you’re someone who doesn’t drive fast or often and follows the rules of the road, UBI could save you money compared to a standard auto insurance policy.

Liability-only car insurance

To get the cheapest auto insurance in Michigan, you should consider limiting coverage to the state’s minimum 20/40/10 coverage. We recommend purchasing more coverage if you have the funds, but if that’s not possible, liability-only car insurance may be your best option. This is the coverage required in Michigan:

  • $20,000 bodily injury liability coverage per person
  • $40,000 bodily injury liability coverage per accident
  • $10,000 property damage liability per accident out of state
  • $1,000,000 property damage protection for accidents in state
  • Personal Injury Protection (PIP)

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