7 Useful Facts About International Auto Insurance You Should Know Before Driving Abroad

If you are going to be driving a car in a foreign country, there are some essential facts you should know. These facts can save you from accidents, massive bills, and tons of wasted time.

1. Your Home Country’s Driver’s License May Not Work

Your local driver’s license usually does not work in foreign countries. You may be unable to rent a car and if you get caught driving with just your home country license, it could be a criminal offense (depending on the country).

Most countries accept an International Driving Permit (IDP). An IDP is not an actual license, but an official translation of your current license to a valid form abroad. Make sure you get an IDP from a national car organization, like the American Automobile Association (AAA) or the National Auto Club. These organizations require a current driver’s license and at least two passport-sized photos when you apply for an IDP.

2. Your Current Auto Insurance Probably Doesn’t Cover You Abroad

Some people falsely assume that their current car insurance will cover them overseas. This is often false because different countries have their own laws and regulations.

Some countries have more stringent laws than others. You may need liability insurance of at least $200,000 to drive. Other countries have insurance that changes rates if you become an official local resident or register a car.

Credit card companies and car rental agencies sometimes offer international insurance policies. But they are sometimes limited in scope and quality. It can be confusing and overwhelming to sort through these laws on your own. That is why it is best to speak to an insurance company that specializes in international insurance to do the work for you.

3. Different Countries Have Different Traffic and Cultural Rules … And It Matters A LotFacts About International Auto Insurance

Foreign countries usually have a few surprises when you experience their traffic for the first time. These differences usually come from better or worse government enforcement and economic prosperity. Lack of preparation for these cultural norms usually increases the chance a traveler will have an accident.

The top differences to look out for include:

  • Much more aggressive driving and disregard for stop signs and traffic lights.
  • Driving on the left side of the road instead of the right and vice versa.
  • Different road conditions. The road may be much wider or narrower than you are used to. And the quality of the road may be better or worse than what you are used to.
  • Varying traffic penalties. Police may require you to pay on the spot or give a bribe.

4. Your Car Insurance Is Probably More Expensive Than at Home

You may be wondering why the quote for your international car insurance is higher than what you’re paying at home. This is because travelers are more likely to experience a car accident. Travelers are usually less familiar with the cultural laws, aggressiveness of driving, and regulations.

This is more reason for you to make sure you get insurance before you arrive. If you know an accident is going to happen, it is better to prepare for it with insurance so that you pay less when it does happen.

5. It May Be Worth It To Get Extra Coverage

Getting extra forms of insurance coverage could be well worth the investment. A bare bones coverage package may leave you exposed to other accidents during your travels. Theft is a commonly overlooked issue by expats because it happens less in their home country. In many developing countries, it can be a common occurrence to have your watch, wallet, backpack, or technology stolen from you.

There are forms of insurance to cover all the most common accidents that can occur while overseas. Other than property insurance, a big one to be aware of is health insurance. Foreign diseases are a common occurrence.

6. You Don’t Always Need Coverage … But It’s Important to Check

Not everyone traveling abroad actually needs car insurance. You may not need insurance if you are already covered by your home country’s insurance or your credit card company.

Many companies don’t offer this or only offer a limited policy so be sure to check first. It’s important to do your research rather than assume you have it and get into a lot of trouble later.

The most likely time you will need international auto insurance is when you are working in a foreign country for an extended period and drive a car.

7. Choose the Right Insurance Companies Because Some May Not Actually Underwrite Policies

You may be surprised to learn that some insurance companies may not actually underwrite the international policies themselves. Instead, they find low-priced insurance companies in the country you are visiting to underwrite them.

If you want a trustworthy car insurance provider, choose a company that specializes in underwriting international car insurance, like Clements. This way, you get the most comprehensive options and best rates.


When it comes to international auto insurance, it can get hairy. There are regulations and laws that can prevent you from happily driving a car in a foreign land. With these 7 tips, you will be well prepared to handle the cultural differences and foreign laws. If you work with a good international insurance provider, they can do the work for you so you don’t have to worry about the paperwork. Plus, you are more likely to get the best rates.

This article was contributed by international insurance experts Clements Worldwide. Clements offers low-cost international auto insurance plans for expatriates. Visit their website for a free quote.

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