Insurance Facts and Statistics for Married Couples

Summertime means fun in the sun for most. It’s also wedding season, with June and September typically the busiest months. If you’re getting married, or even just considering it, it is worth considering the impact marriage has on many aspects of your life, including your finances and insurance.

Both marriage and the divorce rates are declining, according to the latest census data. The cost of divorce continues to rise, however, between attorney’s fees and settlement costs. Most people may not give too much thought to how their insurance needs change when going through a major life event, such as marriage or divorce. Understanding the impact of combining insurance and households could help save you some financial headaches down the road.

Auto insurance for married couples

Auto insurance is legally required in almost every state. While most states require you to purchase minimum liability or personal injury protection, the amount you pay for premiums can vary significantly based on lots of personal factors. Consider this:

Marriage is not the only factor impacting how much you pay in car insurance premiums. Many individual, personal factors are used to calculate the costs. Insurance companies use information such as:

• Credit: Insurance companies often use your credit-based insurance score to calculate your premium. This practice is not legal in all states.
• Driving record: Your driving record affects how much you pay, and at-fault accidents, tickets and DUI/DWI convictions will increase your rates.
• Vehicle: The make and model of your vehicle can impact your insurance premiums greatly. For example, expensive luxury cars often cost more to insure because the insurance company will have to pay more for replacement parts.
• Miles driven per year: Many insurance companies offer discounts or programs to offset premiums for drivers who drive fewer miles per year.
• Coverage options selected: Customizing your policy means adding various levels of coverage and options, all of which impact rates.

Adding a spouse often means combining insurance policies. Many insurers, such as Progressive, require you to add your spouse to your policy. There may be laws surrounding adding a spouse to a policy too, depending on where you live. The best practice is to call your insurance provider when you get married and confirm the next steps. There can be positive and negative aspects to adding your spouse to your car insurance policy.

Pros

• You may qualify for more discounts, such as multi-driver and/or multi-policy.
• It might make it easier to keep track of your bills with only one payment for the two drivers.
• You might decrease your chance for coverage gaps, especially if you are driving each other’s vehicles.
• Your policy will likely be less expensive overall, due to a lower risk rating from the insurance company (assuming both drivers have clean driving records).
• Your spouse may have a better insurance provider than you, such as one with a greater number of coverage options or better customer service.

Cons

• If your spouse has negative marks on their driving record, it could make your rates more expensive.
• If your spouse’s driving record is considered extremely high-risk, you may risk finding an insurance company willing to insure them.
• If your spouse has poor credit and you live in a state where insurers can use credit to rate your policy, it could cause your rates to go up.
• Age is also a factor for rates, except in Hawaii or Massachusetts, so if your spouse is younger than 25, your premiums may be higher.

Home insurance for married couples

Unlike auto insurance, homeowners insurance is not a legal requirement in any state. However, almost all lenders require a homeowner to purchase coverage when taking on a mortgage. Homeowners insurance not only protects the lender’s investment, but it can be a valuable safeguard for your finances too. Without homeowners insurance, you could be forced to pay repair or replacement expenses out of pocket, which could become a major financial hardship. The average cost for home insurance is $1,383 per year for $250,000 in dwelling coverage.

When purchasing a home and budgeting for the proper homeowners insurance policy after you get married, it’s important to realize there are multiple factors affecting your cost of homeowners insurance. Comparing several quotes is wise since these factors are weighted differently from one company to another.

• Credit: Although this is restricted in some states, many insurance providers use your credit-based score as an indicator of risk for filing a property claim. A lower score for either of you could mean higher premiums for both of you if you are both listed on the policy.
• Claims history: If either you or your spouse have purchased homeowners policies in the past and have a history of making claims, it can have a negative impact on rates.
• Age of home: An older home may be more likely to have greater problems and cost more for repairs when a claim is filed.
• ZIP code: The location of your property will greatly affect your home insurance premium. So, for instance, if you are moving to an area with more risks after you get married, such as hurricanes or wildfires, you might face higher home insurance costs.

Life insurance for married couples

When you have a significant other in your life, it may be time to think about providing the financial security and peace of mind that comes with a life insurance policy should something happen to you. This is especially true as your expenses increase if you get married and decide to start a family. A life insurance death benefit could be set up to cover your mortgage, costs to raise children, education or other big life goals. Some policies will also offer a cash value account that allows you to access some of the money while you are still alive under certain circumstances, such as long-term care needs or a low-interest loan. Here are a few facts and statistics you may want to consider when buying life insurance after you get married:

Like auto and home insurance, the cost of life insurance is also impacted by personal rating factors, although marriage itself is not likely to play a role in your rates like it can for home and auto insurance.

• Age: Whereas auto insurance typically decreases as you get older, life insurance becomes more expensive, since the higher likelihood of a health issue may arise. Many experts recommend purchasing life insurance when you are young and healthy.
• Health: Your health history is typically evaluated when purchasing life insurance, including family history too, to determine if you are a higher risk. Some providers require a medical exam, while others do not.

Marriage insurance

Many have heard of a prenuptial agreement, or “prenup.” You may also hear it referred to as marriage insurance. A prenup, or marriage insurance, is a contract a couple agrees to prior to marriage that spells out each person’s legal and financial rights if the marriage ends in divorce. With the average age of marriage now over 30 for men and age 28 for women, according to the Census Bureau, more couples could be coming into a marriage with debt and assets. A prenup is written to detail the instructions for many situations, but a few examples might include:

• Any debts or assets prior to marriage
• Children
• Any assets and debts taken on after marriage
• Family property
• How the property is divided in the case of divorce
• Life insurance policies
• Health insurance responsibilities

While prenups are something we often think of associated with celebrities or people with extreme wealth, they can be designed to protect the interests of any couple. Before deciding if this is something you and your significant other need before walking down the aisle, consider the pros and cons of marriage insurance.

While some people may look at a prenup as a sign that you think your marriage might fail, they are becoming widely more accepted. You may want to consider speaking with a financial advisor or certified financial planner to determine what’s right for you and your spouse-to-be. An objective third party could help ease any concerns about the process.

Frequently asked questions

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    How long do I have before I need to add my spouse to my car insurance policy?

    Most car insurance companies require that you list any licensed members of your household on your car insurance policy, whether you’re married or not. With that in mind, it’s probably safest for you to add your spouse or spouse-to-be to your car insurance policy as soon as you both reside in the same household.

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    Do the same insurance ‘rules’ apply if I have a domestic partner and not a spouse?

    It depends. For starters, you’ll want to see what your city and state’s laws are regarding domestic partnership. In some places, it is treated mostly the same as marriage from a legal standpoint. Next, it depends on what kind of insurance you are talking about. There might be different requirements for car, home or life insurance when it comes to domestic partners, and different insurance companies may each have their own rules about how domestic partnerships are treated. In addition to checking the laws where you live, it might be a good idea to consult with your insurance agent or agents to see how domestic partnerships are treated for that type of insurance and with that company.

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    Can I put my fiancé on my insurance?

    Let’s start by breaking down the three types of insurance we discussed. When it comes to car insurance, you can (and will often be required to) put your fiance on your policy if you are living in the same household or share ownership of your car. For home or renters insurance, it will depend on whether you are both listed as official owners or lessees. Since you are not related by blood and not yet by marriage, your fiance may need to get a separate policy to cover their belongings if they are not listed as a homeowner or renter on your lease. When it comes to life insurance, you can buy a joint policy regardless of marriage. To learn more about your insurance options for your specific situation with your fiance, you may want to consider speaking with a licensed insurance agent or financial advisor.