Where to Get U.S. Car Insurance for International Drivers with Foreign Licenses
If you’re an international driver with a foreign license looking to get U.S. car insurance, the process will be complicated.
Much will depend on the length of time the coverage will be necessary.
For example, there’s one process for short-term travel to the U.S., another for an extended stay, and still another for permanent coverage.
Which you’ll choose, and what will be involved in obtaining coverage, will depend on your reason for being in the U.S.
How to Get a U.S. Auto Policy for Drivers with Foreign Driver's Licenses
From this point forward, we're going to discuss car insurance for foreign drivers who are either in the U.S. for an extended period of time – like several months up to one year or more – and those who will have relocated to the U.S. at least semi-permanently.
If you’re going to be in the U.S. for an extended period of time, you’ll need to obtain coverage from an insurance company that offers temporary policies.
Unfortunately, very few of the big-name car insurance providers offer this type of coverage.
But there are several companies that do offer it.
Driving history does not transfer
Since you’re a foreign driver, your driving history in your home country will not transfer to the US.
For this reason, the premiums you’ll pay for coverage will be higher than it would be if you were a long-term resident of the US.
That would give the car insurance company an opportunity to assess your driving history.
But since that doesn’t exist, the company will need to price your premium to cover the higher risk level.
However, the longer you’re in the US, the more time the car insurance company will have to assess your driving history.
If you avoid at-fault accidents or moving violations, your premium should gradually fall.
Permanent car insurance policy
If you’re planning to stay in the U.S. for more than a few months, you’ll need to get a permanent car insurance policy.
However, to do that you’ll need to obtain a US driver’s license.
Obtaining the license won’t result in a lower premium immediately, but it will start the clock ticking on your driving history.
Generally, if you go three years without an at-fault accident or moving violation, your premium will be on the lower end of the scale.
It will be worth obtaining a U.S. driver’s license if you expect to be in the U.S. for at least two years.
What Information or Documents are Needed to Prepare?
To start the application process, you’ll need a driver’s license from your home country, as well as an International Driving Permit, or IDP.
This is a document that can be issued by the department of motor vehicles in your home country.
Though it’s not a driver’s license itself, it provides validation that you do have a driver’s license in your own country, and that you met the standards required to obtain it.
The process of acquiring an IDP varies from one country to another, however they are not issued by the U.S. government or by the individual U.S. states.
Other information required is likely to include the following:
- The full names of all drivers on your policy.
- Dates of birth of all drivers on the policy.
- Your personal address in the US.
- Phone number.
- Email address.
- US-based bank account information (for payment purposes).
- Occupations of all drivers on the policy.
- Expected annual mileage you’ll be driving.
- The make, model, and year of the vehicle(s) covered under the policy, as well as a list of any safety equipment in the vehicle, which may result in a discounted premium.
The specific documentation requirements will vary by company and by your state of residence in the U.S.
Available Coverages and What They Insure
U.S. car insurance starts with liability coverage.
That’s the portion of a policy that will pay damages to the other driver in an accident that’s determined to be your fault.
Minimum liability coverage limits vary by state, and there may be additional coverage requirements as well as.
The liability requirements in each state will be shown in a sequence of three numbers, such as 50/100/25.
Each represents the minimum requirement in the state in thousands of dollars.
The three coverage limits represented by each number are as follows:
- The first number represents liability for bodily injury or death to one party in an accident that’s determined to be your fault. The “50” means the minimum requirement is $50,000 for this portion of the liability.
- The second number represents the liability for bodily injury or death to two or more parties in an accident that’s determined to be your fault. The “100” means the minimum requirement is $100,000 for this portion of the liability.
- The third number is what the insurance company will pay for property damage you cause. The “25” means the minimum requirement is $25,000.
However, these numbers represent the minimum required under state law.
You may decide that you want a higher level of coverage as a way to protect your assets from a suit filed by the other driver.
Additional coverages for U.S. car insurance policies
There are a large number of other provisions that can be included in a car insurance policy.
Some are requirements in certain states, others are required by the lien holder on your vehicle, and still others are completely optional.
Below are the most common:
- Uninsured/under-insured motorist. Even though car insurance is a legal requirement in nearly every state in the US, millions of drivers go without it. Others opt only for the state minimum coverage requirement. If you’re involved in an accident with either type of driver, this provision will cover you.
- Personal injury protection (PIP). This is a typical requirement in states that have no-fault insurance laws. Those are states in which each driver recovers damages from their own insurance company, regardless of who is at fault in an accident. PIP will cover medical bills and lost wages, since no-fault states typically limit your ability to sue to recover damages.
- Collision. If you’re involved in an at-fault accident, this option will cover the cost of either repairing or replacing your vehicle. Though it’s not a state requirement, it will be required if you have a loan or a lease on your vehicle.
- Comprehensive. This will cover the repair or replacement of your vehicle if it’s either stolen or partially or completely destroyed while parked. It’s another coverage that will be required if you have a loan or a lease.
- Guaranteed auto protection (GAP). If your vehicle has a loan on it or a lease, this provision may be required. It will fully pay off the loan or the lease if the vehicle is completely destroyed in an accident. A typical policy will only pay the full value of the car. But if the loan or lease balance is higher than that value, GAP coverage will pay the difference.
Other optional coverages include:
- rental reimbursement
- roadside assistance
Factors that Affect Car Insurance Premiums for Foreign Drivers
The cost of your car insurance premium will depend on a number of factors, including:
- the state of your temporary residence
- the amount of coverage you require
- your age
- marital status
- credit rating
- the type of vehicle you own or will lease
- any safety features the vehicle
However, the main factor in determining car insurance premiums – your driving history – is not available to US car insurance companies.
That being the case, your premium will be higher than it otherwise would be if you have that history.
Some strategies to keep the premium as low as possible, include:
- Choose the highest deductible you can afford; it can reduce your premium by several hundred dollars.
- Maintain the lowest level of liability coverage your financial situation will allow.
- If you’re purchasing or leasing a car in the US, avoid large SUVs, pickup trucks, and luxury vehicles – the premiums will be much higher.
- Be sure the vehicle has as many safety features built into it as possible, since these serve to lower your premium.
- You’ll typically get a discount for both multiple vehicles and multiple drivers on the same policy.
- You may get a discount if you complete an insurance company approved driver safety course.
You should ask the insurance company which discounts are available to you, and take advantage of any that are.
Travelers Using Rentals
If you’re renting a car for a short-term trip to the US, such as not more than a couple of weeks, the best option will be to purchase coverage through the car rental company.
For example, Hertz offers their Liability Insurance Supplement (LIS) policy. It offers up to $1 million in coverage for both liability and property damage in an accident that’s determined to be your fault. The actual amount of coverage you’ll have under an LIS policy will depend on the specific liability requirements in the state you’re renting the vehicle in.
You should be aware that when you purchase car insurance through a car rental company, the daily rate for the car insurance can easily exceed the daily rate for the rental itself.
As much as we’d like to tell you otherwise, the process of obtaining U.S. car insurance for international drivers with foreign licenses is difficult.
The main problem:
The lack of an established driving history in the US that the insurance company can rely on.
Since driving history is the primary factor in determining car insurance premiums – and the car insurance companies don’t have access to it – you will pay more for coverage.
That is, at least until you’re in the U.S. long enough that you have a satisfactory driving record.