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Can you pay your car insurance with a credit card?

The lowdown...
  • Credit cards seem to be the universal method of payment along with checks/money orders
  • Credit cards present numerous positives for those hoping for a smooth premium payment
  • Alternative methods of payment do exist. Certain insurance providers may accept payment options other providers won’t

The way insurance works, on a very basic level, is simple. For a set, agreed upon premium amount, an insurance contract pays out on legitimate losses and claims filed by the insured customer.

A policy must be active in order for the insured to file a claim. Auto insurance policies are only active when paid and paid timely. So, getting a payment processed right away is in the best interest of the customer.

Credit card payments make the whole process of keeping a policy active a lot easier. While there are several different ways in which an auto insurance policy premium may be satisfied, credit card payments can be easier and more beneficial to employ.

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The Universal Payment Option

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Credit card payments are universally accepted by the major auto insurance providers in the United States.

As long as enough credit is available on the card, payment ends up processing immediately once the charge is made. If any problems arise, the credit card payment is rejected on the spot.

Credit cards, along with checks and money orders, are accepted by all major auto insurance providers.

The other two most commonly accepted payment options are the following:

  • online checks
  • electronic funds transfers (EFTs)

Interestingly, there are two companies that are outliers. The State Farm Group won’t accept EFTs and The Hartford Insurance Group won’t accept online checks.

Making Credit Card Payments

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Making a credit card payment is fairly easy, and there are different options for consumers.

– Paying Online

After creating a free online account, signing in and making payments with a credit card is possible simply by entering the account number and other relevant information.

The technology associated with online profiles allows for saving credit card information making it a very simple process.

– Automatic Payments

To make things even easier, an option for automatic payments on the premium due date is available. Taking advantage of this feature definitely would be to the benefit of customers who do not wish to miss a payment.

Adding a backup credit card to the account is advisable as well. This way, if a problem arises, the charge action simply moves to the next available credit card.

– Calling in the Payment

A toll-free phone call to the insurance company’s customer service line can allow insurance providers to process a credit card payment quite easily. Simply read off the account number, expiration date, and three-digit security code and wait for confirmation.

Get a confirmation number if possible in order to make sure the payment was processed and accepted without any issues.

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– Mailing a Credit Card Check

Credit card companies afford account holders with checks written and borrowed against an available credit card balance. Circumstances may arise in which this method of payment becomes preferable.

Employing the strategy should be done sparingly, though, since user fees and interest rates are somewhat prohibitive.

As you can see, there is more flexibility associated with credit card payments than many realize. For this reason, those who have not made payments with credit cards in the past should consider doing so in the future.

The Statement Copy

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When a payment is made to an insurance company, the chances the provider will accept payment and fail to properly credit the account are slim. Generally, the second a payment is processed, a confirmation email is sent to the customer.

Even if the confirmation email is not sent, logging onto the online account to make sure the payment was processed is a quick and easy process. If you find that your payment was not processed, a quick call to the customer service division can straighten things out.

What happens if the insurance company claims no payment was made at all?

The credit card statement tells all. A charge made and credit in the name of an insurance company is, in essence, proof of payment.

Such proof may come in handy at times and, unlike a cash receipt, even if the statement is lost a duplicate copy can be procured from the credit card company without much trouble.

Presenting proof of processed payment through a credit card statement assists the insurance company in performing an effective payment search.

Alternative Payment Methods

Those unwilling or unable to make payments with a credit card have other options. In addition to the previously well-known ones, there are lesser-utilized, and less-accepted options available.

Those whose policies are with credit card companies willing to accept alternative payment methods may opt to take advantage of them.

PayPal and cash payments are the two most common of the limited acceptable methods of payment. Only three major insurance providers are willing to accept them and they are:

PayPal:

Cash:

Each individual insurance provider’s customer service department can advise on the proper way to process these unique payments.

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Debit Cards Do Not Equal Credit Cards

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Debit cards are commonly processed exactly like credit cards and, as the saying goes, “wherever credit cards are accepted.” This statement may not be entirely correct.

While debit cards are processed in the same way credit cards would be, they are not accepted at the same venues all the time.

The following six major auto insurance companies will not accept debit card processing:

The reasons why debit cards are not accepted are not fully known. Ultimately, it is the prerogative of the individual insurance companies to decide on what methods of payment are acceptable to them.

Perhaps the fact that funds need to be in a debit card account and a lack of funds leading to non-payment factored into their decisions.

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