Car Insurance After a Divorce

Starting over can be stressful, but car insurance doesn't need to be.

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Divorce and car insurance

Your marital status is a minor rating factor used to calculate your car insurance rates. A married driver pays $45 less per six-month policy than a single driver, and $43 less than a divorced driver. Let’s explore why this is, how you can save, and other important insurance-related topics to consider after divorce.

Does divorce affect car insurance?

  1. Best car insurance rates for divorced driver
  2. How to split your auto insurance policy after divorce
  3. Divorced parents and car insurance
  4. Homeowners insurance and other topics

 

How to find cheap car insurance after a divorce

Unless you live in Hawaii, Massachusetts, or Montana, your auto insurance rates may increase after a divorce. Car insurance companies use historical data showing married drivers are less likely to file a claim. Thus, married drivers are less-risky clients. As a result, married drivers pay slightly less for car insurance than do divorced or single drivers.

martial status 2019

The most affordable insurance provider after a divorce is USAA. At $497 per six-month policy, USAA's costs come out to approximately $83 per month (methodology).

Insurance Provider
6-Month Premium
Allstate
$960
Farmers
$781
GEICO
$602
Liberty Mutual
$974
Nationwide
$580
Progressive
$833
State Farm
$807
USAA
$497

 

Those who don't qualify for a USAA policy should consider Nationwide or GEICO. This data sample reflects pricing for a divorced man with a 2015 Honda Accord. Enter your ZIP code below to see free quotes based specifically on your driving profile.

 

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How to handle auto insurance after divorce

When it comes down to it, divorce involves splitting assets — car insurance included. Let’s review some things worth considering after a divorce. 

 

Who is the policyholder? Who owns the vehicles?

This is the complicated part. Depending on who you’re insured by and who is the policyholder, i.e., primary insured and the person who created the policy, removing your former spouse from the policy might be a team effort. Because many insurance companies won’t allow you to remove your spouse without their consent — or proof they are no longer living at the listed residence — you might need your former spouse to contact the insurance company.

If you own vehicles jointly, your ability to collect claims payouts could be impacted. The owner of the vehicle is typically listed on the policy, giving them a right to collect claims payouts on the car. Come to an agreement with your former spouse as to who should manage the insurance on your vehicle(s), as well as who should retain the title and registration. 

Some companies allow you to “split” policies after a divorce — almost like cutting the policy down the middle. This relatively uncommon perk allows you to stay with the same company and avoid purchasing a new policy elsewhere.

 

Remove your former spouse from the policy and shop for insurance again

A final — and important — step is to remove your former spouse from your auto insurance policy. Your premium is priced based on many individual rating factors. If those rating factors are negative, your rates will be more expensive. By removing a source of risk, i.e., a second driver, your premium could become more affordable.

If you were removed from the policy, you should acquire new auto insurance as soon as possible. If you’re no longer covered by your former spouse’s insurance and don’t currently have your own, you'll be left without coverage in the event of an accident.

 


 

Divorced parents and car insurance

If your kids are not of driving age, you don’t need to worry about their car insurance. But if you have split custody and your kids will be driving both your and your former spouse’s vehicles, you need to make some adjustments.

The easiest way to think about this:if your teen driver uses your vehicle more than 12 times a year, he or she needs to be insured on your policy.

If your former spouse insures your young driver, you will also need to include them on your policy if they use your vehicle. Car insurance follows the vehicle, not the driver. So add them to your policy if they’re a frequent user of your vehicles.

If your circumstances are unique, speak to an insurance agent or a customer service representative.

 


 

Homeowners and renters insurance

Handling a home can be tricky after a divorce. Setting aside the logistical issues of deciding who remains in the residence, consider what divorce means for your liability insurance. Liability coverage within the realm of homeowners and renters insurance is much different than it is for auto insurance.

Your personal liability coverage covers you in the event you're found liable for damages, someone is injured on your property, your dog bites someone, or if you are found at-fault for damages outside of your home.

If you do decide to move out and your spouse stays in the home, wait to remove your name from the insurance policy. In the event something happens to the home, complications can arise with claims checks and corresponding information if you’re no longer listed on the policy. It’s best to leave your name on the home insurance policy until residency details are ironed out.

If you’re keeping your residence

If you’re the one who will be remaining in your previously shared home, confirm the homeowners or renters policy is in your name — not yours and your former spouse’s. In the event of a claims payout, the check will usually say both of your names. This could cause complications when you try to cash or deposit the check.

If you’re selling your residence

If you decide to sell the home because no one will be living in it, simply cancel the policy once the home is in the hands of the new owner and you have established a new policy. Remember, your homeowners or renters insurance acts as a protection for your belongings and your liability. So canceling your policy before you have a replacement leaves you vulnerable if you’re found at-fault for an accident.

If you're moving out

If you're moving out of the residence and your former spouse is staying at the previous residence, take the initiative to remove yourself from the former policy once you have a new one. It's important to complete this step: any claims that your former spouse might file would impact your insurance record if you remain on the policy.

 


 

Related content

If you’re looking for more information related to car insurance and marital status, see our additional articles.

 


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