No down payment auto insurance means drivers pay nothing upfront. Instead of paying for insurance one time in six months or 12 months, you pay installment payments each month. Many insurance companies offer a discount when drivers pay upfront because there is less administrative work involved and they know the customer is committing for a longer period of time. However, not everyone has the entire amount to pay all at once.
Generally, people prefer to make installment payments because it seems cheaper. A portion of the payment, usually a sixth or twelfth of the total, is paid each month. These are manageable payments and do not require a huge lump sum all at once. Since the average person lives paycheck to paycheck, this is a much easier way to purchase auto insurance.
The downside is, overall, drivers end up paying more. Over the course of the six or 12 months, the total amount paid is higher because discounts are not applied. If you have the financial ability to pay for your insurance coverage upfront, you will definitely save money over the long haul. Unfortunately, not everyone has the ability to do this, so no down payment auto insurance is a great option.
The other advantage you might have if you choose 0 down payment auto insurance is lack of commitment. Though some companies require drivers to commit to a six month period or longer, other companies charging month to month require no long-term contract. If you believe you can find cheaper insurance elsewhere, but you have no time to search for coverage at the moment, no down payment insurance might be a great temporary option. The important thing drivers need to remember is this is not always the case with no down payment insurance. Just because you are not making an initial down payment does not automatically mean you are not committing to a contract. If short-term insurance is what you need, make sure you are sure that is what you get before finalizing your coverage.
No down payment auto insurance is a great option for many drivers. If you need no down payment auto insurance, use our free search tool to find coverage that is right for you.