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Divorce Auto Insurance: 5 Things to Pay Attention to When Getting a Divorce

Updated: September 22, 2018

While there are many discounts available for couples who get married, these discounts do not carry over to your policies when you get a divorce.

The process involved in divorce auto insurance really depends on how your policies were structured during the marriage.

Couples who maintained separate policies during the marriage are not impacted too much.

The only thing that will change in this situation is the price of each individual’s car insurance policy, because they will lose the marriage discounts.

However, insurance and divorce is a more complicated combination of factors for those couples who have a joint policy.

Divorce Auto Insurance: Removal of an Ex-Spouse

When it comes to divorce auto insurance, couples who had a joint auto insurance policy are generally going to face greater headaches.

There is no doubt that you will face negative repercussions to your auto insurance policy if you get a divorce, especially if the marriage lasted for a significant period of time.

If you had a joint auto insurance policy, there is a greater possibility that you both lay claim to the relevant insured vehicle. If this is the case, you will have to resolve the vehicle ownership issue during the divorce.

In terms of “splitting” the auto insurance policy, the individual whose name the policy is under will generally keep it. The ex-spouse’s name is taken off the policy, and they have to get their own insurance for the vehicle(s) they own.

There is no doubt that you will face negative repercussions to your auto insurance policy if you get a divorce, especially if the marriage lasted for a significant period of time.

For one, it means losing any discounts related to being married. In addition, the ex-spouse who joined the other spouse’s auto insurance policy may have a harder time getting a good rate because they did not have auto insurance under their name for many years.

Details Regarding Divorce Auto Insurance

There are many factors related to divorce auto insurance that individuals must consider. The first step is ensuring that both spouses are comfortable with their vehicle ownership situation after a divorce. This process is a lot easier if both spouses had individual vehicles throughout the marriage.

It is important for both individuals to understand that they may not be able to afford the same level of coverage as before.

When the divorce is finalized and one spouse is removed from the joint auto insurance policy, this spouse must go about getting a new policy.

It is important for both individuals to understand that they may not be able to afford the same level of coverage as before. Because they had a joint policy that they were splitting, the individual cost was a lot less.

Now that each spouse must get their own policy, they will have to lower their level of coverage if they still want to pay the same amount for auto insurance. The other option is to accept higher premiums to retain the same level of coverage.

Getting divorced also means a new lifestyle. One spouse may have to drive a lot more now that they are on their own, which generally means getting a more thorough insurance policy.

How Does Divorce Impact Auto Insurance Premiums?

Divorce does have an impact on the premiums paid for auto insurance. There are many discounts available when you get married.

Since married couples usually have more than one vehicle, and own a house, they may have been eligible for multi-vehicle and multi-policy discounts from the insurance company.

Since married couples usually have more than one vehicle, and own a house, they may have been eligible for multi-vehicle and multi-policy discounts from the insurance company. These discounts no longer apply after the divorce, especially if the home is sold off and each spouse owns one vehicle.

However, a divorce does not necessarily mean each spouse faces higher premium rates. For example, one spouse may have a perfect driving record. If their other spouse had accidents on their record, the joint policy reflected those accidents.

Now the spouse with the perfect driving record will get a policy based on their record, not their spouse’s. This gives them access to discounts for safe driving that they could not obtain through joint insurance.

The type of vehicle owned is also going to impact insurance premiums. If a spouse downgrades to a cheaper vehicle after the divorce, they may pay less in auto insurance than they were before.

Getting a New Policy of Car Insurance After Divorce

It is very important to get a new policy as soon as you realize you are heading for divorce. If you already know which spouse is keeping the current policy, the other spouse must get insurance as soon as possible.

Do not delay your new policy if you are getting a divorce. Sit down with your spouse and decide who is keeping the current policy.

Waiting a few weeks and months to get a new policy is a huge mistake. Not only are you getting yourself into a situation where you are driving without insurance for a significant period of time, but you may get into legal trouble.

Individuals who are caught driving without insurance are subject to financial penalties. If they are caught more than one time they are also subject to a potential license suspension or termination.

Do not delay your new policy if you are getting a divorce. Sit down with your spouse and decide who is keeping the current policy. If you cannot have a civil conversation with one another, have the lawyers discuss the matter.

The sooner you hash out the specifics pertaining to your current policy, the sooner both spouses can ensure their updated policies are offering adequate protection.

Moving to a New State and Getting an Auto Insurance Policy

One significant issue related to divorce and insurance is the fact that spouses often move after a divorce. If an individual is no longer comfortable living in the same city as their ex-spouse, they may decide to move.

No matter the reasons for wanting to move to another state, individuals must understand the impact of such a move on their auto insurance policy.

It is often the cases that individuals request a relocation from their current employer after a divorce. They may even want to find a new job in another state to make a completely fresh start.

No matter the reasons for wanting to move to another state, individuals must understand the impact of such a move on their auto insurance policy.

If you are moving from a fault insurance state to a no fault insurance state, you may have to get an entirely new type of auto insurance policy. If you move from one fault state to another, you might be able to keep your existing insurance company.

It is important to inform your insurance company that you are moving and have them tweak your policy to ensure it meets the legal requirements in your new home state.