Major life changes like marriage and divorce affect almost every aspect of your finances, including your auto insurance. Whether you’re tying the knot or going through a separation, understanding how these changes impact your coverage and rates helps you make the right adjustments at the right time.
How Marriage Affects Your Rates
Getting married almost always lowers your auto insurance premiums. Married drivers pay an average of 4-10% less than single drivers with identical driving records and vehicles. Insurers have found that married individuals tend to file fewer claims and engage in less risky driving behavior than their single counterparts.
The savings are even greater when you combine policies. Merging two separate auto policies into one joint policy with a multi-car discount can save 10-25% compared to maintaining separate policies. Add in a home insurance bundle and the savings compound further.
Steps to Take After Getting Married
After getting married, contact your insurance company to update your marital status. Compare the cost of combining policies versus maintaining separate ones — in rare cases, separate policies may be cheaper, especially if one spouse has a significantly worse driving record. Update your name on the policy if it’s changed. Review your coverage levels together, as your combined financial situation may warrant different coverage than you had individually.
How Divorce Affects Your Rates
Divorce typically increases auto insurance costs. Losing the married discount is the most obvious impact, but there are other factors. You’ll lose the multi-car discount if you were sharing a policy. You may need to find a new insurer if the policy was in your spouse’s name. And the financial stress of divorce sometimes leads to credit score decreases, which can further raise premiums.
Steps to Take During and After Divorce
During the divorce process, make sure your coverage remains adequate and continuous. A lapse in coverage during a divorce can be costly. Remove your ex-spouse from your policy promptly after the divorce is finalized — you could be liable if they have an accident while still listed on your policy.
Shop around for new coverage as a single driver. Your best option as part of a married couple may not be your best option as an individual. And update your address, name, and any other personal information that may have changed.
Separation Period Considerations
During a separation period before divorce is finalized, insurance matters can get complicated. Both spouses typically need to maintain coverage, and the question of who stays on the joint policy versus who gets a new one should be discussed. Consult with your attorney about insurance arrangements during the separation to protect both parties’ interests.
