Car Insurance for Expats in the U.S. (2023)

Moving to another country can be an exciting time, full of changes and new experiences. Expatriates, or “expats,” are people who do just that, choosing to live outside their native country. Getting your own car can help make things feel more like home. For those who move to the United States, it’s important to know that you need car insurance if you choose to own or operate a vehicle here.

Auto insurance rates can differ based on a number of factors, like which provider you choose and what deductible fits your budget. With hundreds of insurance companies in the market, how do you know which one is right for you? Comparing car insurance quotes and companies can help you find the best fit for your new lifestyle.

Challenges Expats Might Face When Getting Car Insurance

With all the car insurance options out there, it might already feel a bit daunting to find a car insurance policy that fits your lifestyle and individual needs. There are a few unique circumstances that expats in particular face, like higher premiums and risk factors.

People who have never had car insurance in the United States before are considered “new drivers.” This usually leads to a more expensive monthly premium because insurance companies register them as having less driving experience and, therefore, a higher risk of getting into an accident. Even if you have driven before, you’re likely to face this as an expat.

Another challenge is that most car insurance companies consider a number of factors when determining how much new policyholders pay, which can include a U.S. credit score. People with poor credit can end up paying thousands more each year than drivers with excellent credit. If you haven’t established a credit history in the U.S., this can be pricey.

However, there are definitely ways to save on your car insurance policy if you find that getting minimum coverage still pushes you over your expat budget. Most insurance companies offer savings when their customers bundle together multiple policies, like health insurance or renters insurance. Also, check for discounts and whether you qualify for those savings.

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Car Insurance for Returning Expats

Some people in the U.S. choose to go abroad to experience a new lifestyle, but it might only be temporary. If this is the case and you’ve just returned from living abroad, don’t be too surprised if you find your car insurance premiums a bit more expensive than you expected. Unless you kept your U.S. auto coverage while you lived abroad, you’ll likely face higher costs.

Even if you aren’t a new U.S. driver, having a gap in your coverage can hike up costs when you get a new policy. Insurify data shows that drivers who have gone without coverage for more than 60 days typically end up paying more. It can help to keep your policy or maintain a policy in the country where you were living to avoid hidden cancellation fees.

If you move abroad and decide to keep your car insurance policy in the U.S., it’s highly unlikely that your car insurance will still cover you internationally. In most cases, policies don’t provide the same coverage if you’re in another country because you’re probably not driving the same car. However, this rule doesn’t apply if you have your car shipped overseas to your new home.

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Temporary Car Insurance

What happens if you just plan to visit the U.S. for a few months? Maybe you have a short-term work contract that requires having a car, or you just find that leasing a car would be useful. In any case, you may want to consider temporary car insurance. While it can be costly, it could be a better deal than getting a full yearlong policy.

It’s important to note that short-term car insurance policies aren’t offered everywhere, and you might need to expand your search. Insurers that offer more traditional annual policies might not offer coverage for just a few months, but you could buy the shortest-term policy from a reputable company and cancel before the term ends. Make sure you understand all the cancellation fees.

There are other options. Car insurance minimums vary by state, but in most cases, rental car companies will provide temporary car insurance if you choose to rent a car. Also, some credit cards that emphasize and are tailored specifically to a clientele that travels a lot can provide international car insurance if you decide to operate a vehicle abroad.

If that doesn’t work for you, there are other methods of getting a shorter-term policy that fits your needs and lifestyle. A cheaper option is getting a nonowner’s policy if you drive someone else’s car, such as a partner’s or employer’s. However, the downside here is that these policies don’t typically provide comprehensive coverage, which may be risky in case of an accident.

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Factors That Affect Your Car Insurance Rates

Don’t worry if you get a car insurance quote and the number is bigger than you expected. A number of factors come into play when figuring out costs, and they vary from company to company. That’s why it’s so important to shop around when looking for your auto insurance coverage—different insurers might value factors in different ways when calculating your rate.

Your location matters, from your state down to your ZIP code. If you’re moving somewhere that has a higher population, like a state capital or urban area, you might find yourself paying a higher rate. This is because the more people on the road, the higher the chance of getting into an accident or causing damage, so you’re more costly to insure.

More importantly, it’s critical that you build your U.S. credit score and driving history. If you have never had car insurance in the U.S., you’re considered a “new driver,” which means that your record indicates you have very little experience behind the wheel. Insurers might also take your credit score into account, so it’s important to work on improving these two scores.

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Common Types of Auto Insurance

So what kind of auto insurance is available? Each auto insurance quote (and how much you pay for your car insurance premium) will differ based on your own unique driving record, the type of car you drive, where you live, and more. Motorists and car owners who live in the United States can choose from several different coverages. Here are the basics:

Liability coverage: There are two parts to this—bodily injury liability insurance can help cover medical expenses, while property damage liability insurance covers damage to another car or property when you’re at fault. This is typically the minimum coverage that most states require to help give people peace of mind in the event of an accident.

Collision coverage: This coverage can help pay for damages to your own car from an accident, regardless of fault. It will pay to repair or replace your vehicle after a collision with another vehicle or an object like a pole or a tree. It usually pays actual cash value (ACV), which is the original value of your vehicle minus depreciation.

Comprehensive coverage: If something other than a collision or accident happens to your car, comprehensive coverage makes sure that you aren’t left paying out of pocket for it. This applies to theft, vandalism, weather-related incidents like windscreen damage, and hitting an animal, among other things.

Uninsured and underinsured motorist insurance: These are two different types of car insurance coverage that work in similar ways. Essentially, if the driver who causes the damage doesn’t have enough insurance coverage to reimburse the full amount, it helps pay for property damage and bodily injury. It can be helpful in hit-and-runs, too.

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Tips for Getting Car Insurance as an Expat

Overall, if you move abroad, the last thing you want to get wrong is the country’s laws and other state mandates. Especially when it comes to keeping yourself, your loved ones, and others on the road protected, it’s important to know that car insurance coverage is absolutely required if you choose to own—or even just operate—a vehicle in the United States, expat or not.

It can be hard to find a quality, affordable car insurance policy as an expat, especially since the rules are likely to feel foreign to you. But whether you’re a returning expat, looking for just a short-term plan, or are considered a “new driver,” you need to have an auto insurance policy.

Frequently Asked Questions