Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Mar 19, 2020

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The lowdown...

  • It is almost always standard for a car insurance company to require a down payment of the first month of coverage for your car insurance coverage
  • Every car insurance company has a different policy in terms of the down payment required and what the options for payment plans are
  • If you have bad credit or have a history of being canceled for not paying your car insurance premium on time, then you may have to plan to pay a larger down payment in order to get your insurance coverage started
  • Some companies offer a pay-per-mile plan for car insurance coverage, but there is still typically a requirement that you put some amount down to start your policy
  • You will probably be able to choose your method of payment and whether you will accept online statements from your insurer

In order to get car insurance coverage even for just one day, you will almost always be required to make some amount of a down payment to get started. For many insurance companies, this typically consists of the amount of your regular monthly premium for car insurance.

If you have special circumstances, such as an especially poor driving record or credit score, then you could be faced with putting a larger amount down for your first payment because of the elevated risk you pose to the insurer.

The good news is that the more you pay upfront, the lower the rest of your monthly bills will be for your car insurance policy.

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Getting Started with Payment for Your Auto Insurance Coverage


It is very important for you to be able to show proof of insurance because of state law requirements and if you are involved in any type of accident. In order to be able to get a proof of insurance card from the insurance company, they will require you to make an upfront payment.

Otherwise, many drivers could simply sign up for a policy without paying for it in order to show that they have the required insurance. This would typically come up in a situation where you are trying to purchase a car.

You will pay less for your monthly premium if you are able to put down a larger initial payment.

Remember that you always have the option to pay the entire amount of your car insurance premium upfront. This means that you would not receive another bill throughout the rest of your policy term, which is generally either six months or one year.

The specific arrangements for the length of your policy term will depend on what is offered by your specific car insurance company.

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What Happens to Your Payment if You Cancel Early

There is not as much of a risk as you might think in paying your premium early or all at once upfront. This is because you have the right to cancel your coverage at any time and get the unused amount of your payment refunded directly back to you.

The insurer might be able to charge you a small fee for the administration of this change, but you will not be precluded from getting a refund of your premium.

If you choose to go this route, do not make the mistake of failing to line up additional insurance coverage. You do not want to have to deal with the headache of being fined or penalized for not having coverage at all times.

Working Out Arrangements for Payment of Your Premium


Most insurance companies now offer online payment options, which can be very convenient.

You want to make sure that you note the date on which your payment is due so that you do not have a late or missed payment. You may also be able to avoid an administrative fee by having your premium payments on an automatic payment schedule with your insurer.

If you find that you cannot work out acceptable payment arrangements, then you can always shop around for other insurance options.

For some drivers who have lower credit scores or a poor driving record, they may find that they are required to pay too much money upfront for insurance.

If this presents a problem, you can speak with your state department of insurance about other insurance options that might not require as much of an upfront payment. You will still likely be paying more for your coverage than the average driver, but you may be able to spread the cost over a longer period of time.

Recap on Paying Upfront for Car Insurance Coverage

It is very standard in the car insurance industry to require all drivers to pay some advance amount of their premium. This is so that drivers do not walk away without proof of insurance without actually intending to pay for it at all.

The amount you pay will depend on your particular factors, such as your insurance score, credit score and payment history, and the policies that are put in place by your car insurance company.

If your agent works for a larger insurance company, his hands may be tied in terms of what he can do to lower your initial down payment. Be prepared to put down the cost of at least one month of car insurance coverage so that you can get started with your policy.

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