Auto Insurance

With few exceptions, getting married will lower your auto insurance rates. But the reason is misunderstood by most consumers. Car insurance companies calculate their policyholders’ premiums based on the likelihood of their filing claims during the time period covered by their policy. This claims risk is determined by a proprietary formula used by the insurer. If you understand the variables used in this formula, you’ll have a much firmer grasp on how to find lower auto insurance rates.

When you get married, the factors that influence your premiums include adding multiple cars to your policy, changing your address, and consolidating multiple types of insurance. We’ll cover each of these areas in detail below.

The Multi-Car Discount

When you and your partner are living in separate households, your respective vehicles are covered under separate policies. Married couples living under the same roof can abandon one of the two policies and add both vehicles to a single policy. Doing so usually yields lower rates. Auto insurers assume the aggregate number of miles driven by both spouses while living under the same roof will be lower than the number driven while living in separate homes.

When you comparison shop car insurance companies, you’ll notice some will neglect to ask whether you are married. This is rarely an error of omission. Instead, insurers are more interested in whether two people living in the same household plan to share a policy. It implies fewer aggregate miles driven.

Change Of Address

It’s not uncommon for one or both partners to change living addresses after getting married. In many circumstances, this too, can potentially lower your premiums. First, a change of address may involve a lower likelihood of filing claims due to theft, vandalism, or traffic accidents. Essentially, some zip codes represent a lower risk than others. If you move to an area that has historically produced fewer claims, you may enjoy lower premiums.

The second reason involves the average number of miles driven following the relocation. Your daily commute to your place of employment may be shorter. The venues you regularly visit may be closer to your new home. These factors imply that you’ll be driving fewer miles and thus, less likely to file a claim. Your auto insurance company may apply a low-mileage discount.

Consolidating Multiple Types Of Insurance

Insurance companies want to attract as much of your business as possible. In the same way financial institutions sell multiple products (e.g. checking accounts, savings accounts, loans, CDs, etc.), so too, do many insurers. After you get married, you’ll become a potential customer for various insurance products.

For example, if you and your spouse are moving into a new home, you’ll need to invest in a home insurance policy. If you intend to start a family, you’ll need life insurance and supplemental health insurance coverage. By consolidating these policies with a single insurer, you’ll have more leverage to request lower rates. In fact, many insurers will extend a formal “multi-line discount” when you bring multiple policies under their roof.

Lower Likelihood Of Filing Claims

Auto insurance companies perceive married people through a different lens than single people. Their data suggests that those who are married tend to be more responsible behind the wheel. They make better decisions on the road. They take fewer risks. There are many reasons why this might be so. For example, married people might take fewer risks because they have families for whom to care. Their lives are now closely intertwined with their spouses and children, so every decision made while behind the wheel is made in that context.

Whatever the underlying reasons, they lead to the same conclusion: married people are less likely to file claims. Thus, car insurance companies are usually willing to extend a discount on their premiums.

Getting married often results in lower car insurance rates (assuming both partners have good driving records). But you should still take the time to compare multiple insurers at least once a year. Millions of people pay more than necessary for their coverage simply because they neglect to comparison shop. Doing so only requires a few minutes. Moreover, you can shop for lower car insurance rates online. It’s the only reliable way to find the coverage you need at the best possible price.