Can You Pay Car Insurance With a Credit Card?

You can pay for almost anything with a credit card in today's world, and that includes your car insurance. Most car insurance companies will allow you to pay your insurance premium with a credit card and even offer flexible payment options. You may face a convenience fee, but if you're able to pay your credit card bill in full each month, paying your car insurance with a credit card could earn reward points and cash back on your purchases.

• Paying With a Credit Card
  
• Should you use a Credit Card
  
• Companies That Accept Credit Cards
  
• Companies With Low Rates
  

Most car insurance companies make it easy to pay with a credit card, and they offer a variety of ways to do so. As with most bills, you can pay online, over the phone, through the company mobile app or even instantly when you request a free quote online.

Nearly every car insurance company accepts credit cards as a form of payment, including some of the largest and most popular companies in the U.S. Some companies may charge a convenience fee for using a credit card, so it’s important to check for that information. According to the National Association of Insurance Commissioners, the following companies have the largest market share in the U.S. and allow you to pay car insurance with a credit card.

Most large insurance companies in the U.S. provide credit card payment options, including some of the most familiar names in car insurance:

• Allstate
• USAA
• Liberty Mutual
• Farmers Insurance
• Nationwide
• Travelers
• American Family

If you're wondering how to reduce your car insurance cost, some car insurance companies that accept credit card payments also offer low insurance rates. While USAA is often the most affordable option, it's available to military members, veterans and their families only. However, the following companies offer the cheapest car insurance rates and will allow you to pay car insurance with a credit card.

Paying car insurance with a credit card comes with pros and cons. If you’re a responsible credit card user it could pay off to go this route. Knowing the risks of using a credit card to pay your car insurance can also help you determine whether using plastic is the right choice for you.

Pros

• Credit card rewards: Many credit card companies offer reward points when you pay off your credit card. These points can be redeemed for travel, cash and other expenses.

• Convenience: It's easy and convenient to pay for your insurance with a credit card. You can set up automatic monthly payments, so you don't have to think about your premium each month.

• More time to pay: If you need some extra cash in a crunch, paying with a credit card gives you more time to pay your bill.

• Pay in full: Most car insurance companies offer a discount for paying your bill in full. If you don’t have the available funds to pay your bill in full, a credit card enables you to pay your car insurance payment on time and gives you more time to pay off the amount. But if you availed the no down payment term you can still take advantage of paying your monthly premium through your credit card.

• Save time: Credit card payments are made instantly, saving time on mailing your payment via mail or money order.

Cons

• Fees: While most companies offer a discount for paying your insurance in full, most will also charge installment fees for paying your bill in monthly increments. This rate can range from $2–$15 and depends on which insurance company you use and where you live. Major companies like Geico, Allstate, State Farm, Progressive and others might charge installment fees in your state.

• Interest rates: If you don't pay off your credit card in time, you'll pay interest on the amount you owe. Interest can get pricey, which is why it's always best to shop for a low-interest credit card.-

• Increased debt: Credit card debt can add up quickly. If you put your car insurance premium on your credit card and can't pay it off, you'll increase your debt.

• Negative credit score: Continually maxing out your credit card or purchasing near its limit can have a negative impact on your credit score.

Credit cards are a convenient and powerful tool for building credit and earning rewards when used wisely. For consumers who typically pay them off each month, it makes sense to use a credit card to pay for car insurance.