Getting divorced is one of the most stressful and difficult experiences a person can go through. You already have plenty to deal with, from lawyers and paperwork to the emotional toll it takes on you and your family. But unfortunately, such major life changes will bring financial changes as well, and that includes your car insurance.
How Divorce Affects Car Insurance
If you have a joint car insurance policy with your partner (which is more than likely if you’re married), you’ll almost certainly have to separate your policy from theirs.
Changes in Your Policy
How will a divorce affect your car insurance? Well, for starters, divorced people (along with other singles) tend to pay higher insurance rates than married people. There are several other factors that can contribute to higher insurance rates when you separate policies:
- If you’re starting a new policy on your own, your rates will likely be higher, because that’s just the reality of starting a new insurance policy.
- If you’re removing another policyholder from your insurance, on the other hand, your rates may not jump as much if your partner was a secondary driver… but you are still likely to see an increase.
- If you’re moving from a bundled policy (in the case of being homeowners, for example), you may see your rates rise from that, as well.
Why these changes? For the most part, it’s because statistically, married people are less likely to get in auto accidents than single people.
Another unfortunate reality of divorced life: you may find yourself moving to a new neighborhood, city, or state, where insurance rates may be higher or lower, depending on the area. This will also depend on the neighborhood you move into; an area with more claims (due to higher crime rate, lower security, or other factors) will increase your risk factor to insurers, and thus your premiums.
If you don’t have any kids of driving age, you won’t have to worry about changes to your insurance in that area. But if you are parents to teenagers, that most likely means you both will have to adjust your policy to get your teen driver on your insurance. Technically, this is only necessary if your teen uses the vehicle more than 12 times a year, but it still pays to be safe. Just remember that car insurance follows the car, not the driver, so more cars mean a separate insurance situation for each.
A last note regarding insurance policies and divorce: most states have laws prohibiting the cancellation or alteration of insurance policies once divorce proceedings begin. So, any changes you make will have to wait until those proceedings are concluded. This can create some complications when it comes to paying the premium, but the situation will be temporary.
Ways You Can Save on Auto Insurance
Fortunately, it’s not all bleak when it comes to your car insurance after a divorce. There are some ways you can lower your premiums with a little work:
- Switch cars. Changing your primary vehicle to an older, less expensive model that’s still in good shape could lower your payments significantly. Newer, more expensive vehicles tend to cost more in premiums because they’re considerably more expensive to repair in the case of an accident.
- Drive safe. The cleaner your driving record, the more your insurance premiums will go down. You can install tracking devices from your insurer that will send driving data to the insurance company, which may further improve your payment situation.
- Shop around. You should never assume your current policy is the best you can do. You should definitely compare insurance rates and see if you can find a better deal elsewhere.
- Downgrade your insurance. Look at your policy, and if there’s coverage you don’t need (such as comprehensive or collision insurance), consider having them removed from your coverage. Just make sure you don’t remove too much — you still want to be covered in case of an accident.
- Installing a security system or anti-theft device on your car will probably earn you a discount with many insurers.
- Some insurance companies offer discounts to drivers willing to pay an entire year’s premiums upfront. If you have the spare cash on hand, consider saving a few dollars that way.
- You can also decrease your insurance by decreasing the amount you drive. Cutting your miles reduces wear and tear on the vehicle, fuel costs, and your chances of being in an accident, which all adds up to savings for you and decreased risk for the insurance company. Ask your insurer what discounts they offer for less frequent driving.
- Increasing your credit score will also get you a better rate on your car insurance. Easier said than done, in most cases, but it’s something to keep in mind.
- Finally, once things have settled down, you can re-bundle your car insurance with other policies (home insurance, life/health insurance, etc.) to bring your rates down further.