The Best Credit Cards for Paying Your Insurance Bills

Paying for insurance bills each month can quickly add up and put a strain on your finances. From health insurance premiums to car and home insurance, these recurring costs can take a big bite out of your budget. Using the right credit card to pay these bills can help you earn valuable rewards and potentially save money in the long run. In this comprehensive guide, we will explore the top credit cards for paying insurance bills and how to maximize rewards.

An Overview of Using Credit Cards for Insurance Payments

Most major insurance providers allow policyholders to pay their monthly premiums with a credit card This includes health, dental, vision, life, home, renters, and auto insurance companies. Paying with a rewards credit card allows you to earn points, miles, or cashback on these payments each month or quarter.

However, it’s important to only use this strategy if you can pay off your credit card statement in full each month. Carrying a balance on your credit cards negates any rewards you earn and results in paying interest charges which can add up quickly. It’s best to have a budget in place and only use a credit card to pay insurance bills if you can afford to do so responsibly.

The Best Rewards Credit Cards for Insurance Payments

Flat-Rate Cash Back Cards

It is best to use the Citi® Double Cash Card to pay your insurance bills with a credit card. You’ll get a 2% cashback on all purchases, plus a 1% cashback when you buy and any extra cashback as you pay. You can get as much cash back as you want every month or year. It’s free to use this card every year, and for the first two months, balance transfers are charged at a lower rate than usual (then a regular rate). 99% – 24. 99% variable APR).

The Capital One Quicksilver Cash Rewards Credit Card is another great choice, offering 1.5% cash back on all purchases with no limit to how much you can earn. There’s also currently a sign-up bonus of $200 after spending $500 in the first 3 months. This card doesn’t have an annual fee either.

Insurance Category Bonus Cards

Some credit cards offer enhanced rewards on insurance payments and bills The Blue Cash Preferred® Card from American Express earns 6% cash back at US. streaming services and 3% back at U.S. gas stations and on transit. It also earns 6% cash back on select U.S. streaming subscriptions, 3% back on U.S. gas stations and transit, and 1% back on other purchases. There is a $95 annual fee.

If you have the old Costco Anywhere Visa® Card by Citi, you’ll earn 3% cash back on eligible travel purchases including gas stations and 2% back on Costco purchases. All other purchases earn 1% back. However, this card is no longer open to new applicants.

The Bank of America® Customized Cash Rewards Secured credit card allows you to choose a 3% cash back category each month from options including insurance companies. All other purchases earn 1% back. There is no annual fee with this card.

Maximize Rewards on Insurance Bills

Here are some ways to get the most out of your credit card rewards when you pay your insurance bills:

• Ask your provider if you can pay monthly, quarterly, or annually. Choosing less frequent payments means hitting bonus spending thresholds faster.

• Pay ahead or prepay bills if possible to front-load rewards. Just make sure your provider doesn’t charge any fees.

• Use a card that offers a sign-up bonus by meeting a minimum spending requirement. Knock out the bonus while earning rewards on bills.

• Pay household bills together on one card to consolidate spending. This helps meet bonus categories like gas, transit, or streaming services.

• Use an insurance bonus category card for those bills, then use a flat-rate card for other household expenses.

• Remember to pay your statement balance in full each month to avoid interest and debt. Set payment reminders if needed.

Drawbacks of Using Credit Cards for Insurance

While paying insurance bills with a rewards credit card can be beneficial, there are some potential drawbacks to consider:

• Interest charges if you carry a balance – this can outweigh any rewards earned

• Potential fees for paying with credit cards charged by some providers

• Need for strict budgeting and money management to avoid overspending

• Rewards could encourage overpayment of policies above a budgeted amount

• Possible dip in credit from higher utilization if balance isn’t paid off each month

• Loss of autopay or paperless discounts offered for bank account or ACH payments

Finding the Best Card for Your Situation

The optimal credit card for paying insurance bills depends on your monthly premium amounts, current cards, credit scores, and ability to pay balances off each month. Evaluate cards based on the rewards rates for your typical spending, taking into account factors like annual fees, sign-up bonuses, and other perks like purchase protection or rental car insurance.

For example, a flat-rate 2% cash back card could make sense if you have high insurance premiums but don’t spend significantly in special bonus categories. Or if you already have a general spending card, look to insurance category cards to complement it. Run the numbers for your situation to maximize value.

Our Top Picks Summarized

Here are our top recommended credit cards for paying insurance bills:

Citi® Double Cash Card – 2% cash back (1% when you buy and 1% as you pay) with no cap on earnings and no annual fee

Capital One Quicksilver Cash Rewards – 1.5% back on all purchases with no maximum on rewards and currently a $200 sign-up bonus

Blue Cash Preferred® Card from American Express – 6% back on select U.S. streaming subscriptions and U.S. gas stations, 3% on transit and U.S. gas stations, 1% on other purchases

Customized Cash Rewards Secured Credit Card from Bank of America® – Choose a 3% cash back category each month including insurance companies, no annual fee

Costco Anywhere Visa® Card by Citi (Closed to New Applicants) – 3% back on eligible travel and gas, 2% at Costco, 1% other purchases

The Bottom Line

Using the right credit card to pay recurring insurance bills can allow you to offset some of the cost through rewards earnings. Just be sure to practice financial responsibility by paying balances in full, tracking rewards earned, and budgeting properly for the payments each month. Evaluate your options thoroughly and choose a card that aligns with your spending profile and needs.