What Happens to Your Car Insurance After a Divorce?
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- Affect on car insurance
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A divorce is an emotionally distressing event that changes everything about your life. The effects a recent divorce have are also far-reaching in terms of finances and insurance.
With car insurance, you will need to make significant changes to your policy, and you may consider finding a new one altogether. Altering the details of your insurance may seem trivial in light of a divorce, but it can go a long way towards preventing headaches in the future.
The most obvious change to your car insurance after a divorce is that your spouse will no longer be listed on the same policy as you. It is extremely important that you have a new policy in place before terminating or separating yourself from the old one.
If you have a lapse in your coverage, this could result in higher rates going forward, which can be easily avoided in this case.
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Does being divorced affect your car insurance?
Separate policies after a divorce mean you will likely lose certain discounts, such as a multi-car discount. But it is also possible for you to take advantage of other discounts and insurance plans that were perhaps not available to you before.
One option is raising the deductible on your plan, especially if you drive very little. This means your premium will go down since there is a higher threshold that must be met before your insurance kicks in.
A related possibility is a low-mileage discount. Maybe you will be closer to work than before and driving less. Perhaps you were close to work all along but your spouse had a long commute, so the discount did not apply to you. Whatever your situation, determine what your mileage will be and make a decision accordingly.
While you won’t get a multiple car discount through your spouse, if you’re divorced but have a teenager who has a car on your policy, you may still be able to qualify for this discount. Situations will obviously vary a great deal, so this may be financially wise for some and not for others.
Getting new insurance after a divorce
It may also be in your interests to change what type of insurance plan you have. If your car is paid off, then you may only need liability insurance and not comprehensive coverage.
This will mean significant savings for you and it is prudent financially, especially if you are on a tight budget. Getting the right amount of coverage will ensure you are not overpaying for services you do not need or overlooking your actual needs.
After a divorce, you are no longer tethered to your spouse’s driving habits. If you are a particularly good driver with a clean history, then you may end up with much better rates than before. The opposite may also be true, however, if you have a poor driving history.
Either way, you can tailor a plan to fit your history and needs, whether by raising the deductible as suggested above or taking driving courses to get discounts on your premium.
You should also look into bundling your home and auto insurance. This is an especially good option if, for whatever reason, doing so was not possible before. If you are living in another home after the divorce, then bundling insurance will result in savings for you.
In the end, the special discounts that apply to you and the viability of any change in the type of plan you have are going to depend on your particular situation. A course of action that makes perfect sense for someone else may be unwise for you and vice versa. While you cannot plan for every possibility, there are ways to keep insurance from being a burden after a divorce.
Can my spouse stay on my insurance after a divorce?
Like with health insurance, car insurance will be split after a married couple gets divorced. This usually happens after the couple decides who gets which cars. You’ll need to update your policy and potentially shop for new ones.
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