While you may not have considered car insurance for unmarried couples, you might want to share a policy with your partner. If you live together, for example, having one auto insurance policy might make sense if you plan to drive one another's vehicles occasionally. Many auto insurance companies now offer policies for unmarried couples under names such as non-relative insurance, roommate insurance, non-married insurance, and domestic partner insurance.
The Concept of Insurable Interest
Insurance companies once prohibited unmarried couples and domestic partners from sharing auto insurance policies. These restrictions noted that while married couples have insurable interest, or ownership, in one another's property, unmarried individuals do not. As modern families have evolved, however, most insurers now recognize that insurable interest often exists outside of marriage. You will probably need to prove that you share an address or have otherwise established a stable, committed relationship. Some insurance companies may even require proof of engagement before issuing a couple a joint auto insurance policy.
According to the website The Balance, you should talk to your insurance company about the availability of joint policies for cohabitating couples. Because these policies are relatively new, state regulations and insurer guidelines can vary dramatically from one company and geographic area to the next. Depending on where you live, you might need to get quotes from several insurance companies before finding a policy that fits both your and your partner's needs.
When to Consider Combining Auto Insurance
When you live with a partner but have not married, you can often save money and streamline your household accounting by sharing a single auto insurance policy. Usually, you cannot add your partner to your policy unless he or she lives with you. However, you could still add your significant other to your policy as an alternate driver (if he or she often visits and uses your car, for example).
If you live together, your insurance company may require you to list your partner on your auto insurance policy. If this provision appears in your policy documents and you failed to do so, the insurance company can make the change automatically if they find out you have another household member. In rare cases, the insurer may consider this fraud, but only if you intentionally withheld the information (in the case of a claim, for example).
The Zebra notes that most insurance companies require you to include your partner on your insurance policy if:
- You live with this person
- They drive your vehicle at least once a month
If you do not add your partner to your auto policy, insurance may deny the resulting damages claim if he or she has an accident in your vehicle. In addition, if you sometimes drive your partner's vehicle, you cannot insure that car and obtain coverage unless the owner of the car also appears on your policy.
Usually, you should avoid sharing a joint auto insurance policy with your partner if he or she has a poor driving record or a history of costly claims. Adding this person to your policy will result in significantly higher rates since it increases your overall risk of filing an expensive accident claim.
This advice also holds true if you have a much better credit score than your significant other or vice versa. In many states, auto insurance companies check your credit as a way to assess risk when providing your rate quote, with higher rates for drivers with poor credit.
What if your partner drives a flashy sports car and you prefer a reliable sedan? The driver with the more affordable car can potentially save by sticking to his or her own auto insurance policy, since the expensive car will cost much more to repair and therefore insure.
An age difference can also complicate the process of combining auto insurance with your partner. Insurance costs fall significantly after you reach age 25. If one person is 26 and the other is 23 or younger, the older partner will pay much more for auto insurance than he or she would alone. The increased cost is especially steep when the male is the younger partner because of the high accident risk in this age group.
Benefits of Combining Auto Insurance
AutoInsurance.org reports that multi-car policies can qualify for an average discount by company as follows:
- 25 percent from GEICO
- 20 percent from State Farm
- 20 percent from Nationwide
- 10 percent from Progressive
- 10 percent from Liberty Mutual
- 8 percent from Traveler's Insurance
Some insurance companies may even offer a discount of up to 30 percent for multiple vehicle policies.
If you live with your partner, you will also need homeowner's or renter's insurance. Combining this policy with your auto insurance policy offers another opportunity for discounts.
Options to Combine Car Insurance
If you and your significant other both have a vehicle, Car Insurance Comparison recommends adding him or her as a qualified driver on your car insurance policy. You can also ask your company to give you a quote for a shared policy as a single driver.
You should know that if your relationship ends and you want to take your former partner off your policy, your rates may increase since you will no longer qualify for the multi-car discounts described above.
If you do not live together and your partner rarely drives your vehicle, he or she does not need to be on your insurance policy. In this case, the insurance policy would likely cover an accident caused by this person if they borrow your car only rarely.
According to CarInsurance.com, the rules about adding household members to your car insurance policy also apply if you have roommates. Before entering a shared housing situation, review your policy documents to make sure you won't end up paying a higher premium because of your household members.
If you share other bills with your partner, it might be time to think about signing up for a joint auto insurance policy. These considerations can help you protect your finances and make a smart car insurance choice.
Sources:
https://www.carinsurancecomparison.com/joint-auto-insurance-for-unmarried-couples/
https://www.thezebra.com/auto-insurance/driver/status/car-insurance-unmarried-couples/
https://www.carinsurance.com/kb/joint-car-insurance-policy-between-unmarried-couples
https://www.thebalance.com/can-i-insure-my-boyfriend-s-car-527466
https://www.autoinsurance.org/can-an-unmarried-couple-combine-auto-insurance/
https://www.caranddriver.com/features/g27197524/best-sports-cars/
https://www.caranddriver.com/shopping-advice/g26327972/reliable-used-cars/
