When shopping for insurance, you’ve probably wondered if you can pay your premium with a credit card. The answer depends on the type of insurance you’re buying. While you may be able to pay for auto insurance policies with your credit card, for example, your life insurance company might refuse. And even if you can use your credit card, you need to consider whether it makes financial sense to do so.
Here’s what you need to know about buying and paying for insurance premiums with a credit card.
Why would I want to pay my insurance with a credit card?
Using a credit card is a common way to pay for everyday expenses for many Americans. Not only can it help you earn rewards, like cash back or travel rewards, but credit cards also come with protections that debit cards don’t have, making a credit card payment preferable to using a debit card in many scenarios.
Some of CNBC Select’s top picks for credit cards in 2023 include the Chase Sapphire Preferred® Card (see rates and fees) for its generous welcome bonus and strong travel rewards for purchases on travel and dining. For those seeking cash back rewards, the Citi Double Cash® Card offers 2% cash back on eligible purchases — giving you 1% when you make a purchase and another 1% when you pay your credit card bill (see rates and fees).
The Chase Sapphire Preferred® Card packs a punch for a $95 annual fee card, offering annual travel credits, comprehensive travel protections and more.
- You can transfer rewards to all of Chase's travel partners including World of Hyatt, Southwest Rapid Rewards and many more
- Long list of travel and shopping protections
- $50 annual Chase Travel hotel credit
- Has an annual fee
- Requires a high credit score
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select's editorial staff.
- Earn 75,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening.
- Enjoy benefits such as 5x on travel purchased through Chase TravelSM, 3x on dining, select streaming services and online groceries, 2x on all other travel purchases, 1x on all other purchases
- Earn up to $50 in statement credits each account anniversary year for hotel stays through Chase TravelSM
- 10% anniversary points boost - each account anniversary you'll earn bonus points equal to 10% of your total purchases made the previous year.
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
- Complimentary DashPass which unlocks $0 delivery fees & lower service fees for a min. of one year when you activate by 12/31/27. Plus, a $10 promo each month on non-restaurant orders.
- Member FDIC
Balance transfer fee
Either $5 or 5% of the amount of each transfer, whichever is greater
However, you’ll want to make sure that your credit card is paid in full and on time — carrying a balance on your card might negate any of the perks you could receive since credit card interest charges can be expensive. If putting your insurance premium on your credit card would cause you to carry a balance, it might be worth looking into other options, like a transfer directly from your bank account.
Can I pay for auto insurance with a credit card?
Many large insurers let you use a card for your auto insurance premiums. Progressive, Geico and State Farm all allow payment by credit card and were also some of our top picks for car insurance this year, due to their savings options, availability, and coverage.
Progressive Auto Insurance
Policy highlights
Progressive offers an array of riders, including rideshare insurance and a Deductible Savings Bank that deducts $50 each policy period you go without a claim. It also offers mechanical breakdown insurance, which covers unexpected major systems failures.
Accident forgiveness
Yes
Availability
Progressive auto insurance is available nationwide
Terms apply.
Read our Progressive auto insurance review.
Geico Auto Insurance
Policy highlights
Geico offers 16 discounts and a variety of optional add-ons, such as emergency roadside assistance, rental car reimbursement and mechanical breakdown insurance.
Availability
Geico auto insurance is available in all 50 U.S. states and Washington, D.C.
Accident forgiveness
Accident forgiveness is automatic if you remain accident-free for five years. It can also be bought as an upgrade when you buy or renew your policy.
Terms apply.
Read our Geico auto insurance review.
However, some car insurers may charge a fee for using a credit card. It’s worth making sure that there aren’t any fees imposed by a credit card payment, as this could actually add to the amount you’ll pay for insurance coverage and might negate any benefits or perks.
Can I pay for life insurance with a credit card?
It’s likely that you won’t be able to pay for life insurance with a credit card. You may be able to use a card for your initial premium payment, but afterward, you’ll generally need to set up an electronic funds transfer (EFT) or write personal checks from your checking account.
Can I pay for homeowners insurance with a credit card?
With homeowners insurance, whether you can use a credit card largely depends on your insurer and the status of your mortgage.
If you don’t have a mortgage and your home is paid off, it’s up to your insurer and you as to how you pay your homeowners insurance. As with auto insurance, it might be worth checking to make sure that there aren’t any fees required for credit card usage.
But if you have both a mortgage and an escrow account, you may be out of luck when you try to pay your premiums with a card. That's because the purpose of an escrow account is to pay for large expenses (such as your property taxes and insurance premiums) from a bank account over time, and this precludes the use of credit cards.
Whether or not your mortgage lender requires you to have an escrow account depends on the type of mortgage you have, the amount of equity in your home and the state you live in. For example, FHA loans and USDA loans require escrow accounts, so you won’t be able to pay on your own with a credit card with these loan types.
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Bottom line
Paying for your auto insurance with a credit card may make sense. However, not every insurance type can be paid with a card. Check with your insurer to make sure there aren't any fees and make sure you'll be able to pay your balance in full to make the most of any benefits you could get from using your card.
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