When Married Couples Should Seek Separate Car Insurance Quotes

Most married couples save money when they combine their coverage into one policy and get a single auto insurance quote. But occasionally separate car insurance for married couples makes more sense.

A bad driving record, poor credit or an expensive sports car are common reasons couples choose to keep separate policies. Here’s a look at when to consider breaking up your policies.

How bad driving affects car insurance quotes
In certain cases a combined policy won’t pay off. Raphael Locsin, owner of Shift Insurance, an independent agency in Lakewood, California, says only a small percentage of his married clients find a better deal by purchasing separate car insurance policies. Usually this happens after one spouse is convicted of a serious violation, such as a DUI, and the insurer either refuses to cover that spouse or hikes the premiums “through the roof” at renewal time, Locsin says.

The spouse with the DUI will probably find the lowest rates with a company that specializes in higher-risk drivers. Those companies typically offer only the state-minimum amounts of liability coverage for drivers with serious violations, and they don’t offer extra discounts.

Rather than both spouses settling for bare-bones coverage, some couples split their car insurance policies, although this can be tricky.

For example, if the husband has the DUI, he buys a policy for the car he drives. The wife then buys a policy for her car and asks the insurer to exclude the husband from coverage, barring him from driving her car. An exclusion means the insurer will not pay any claims resulting from the husband driving the wife’s car, leaving the couple on the hook for all damages.

However, this works only in certain states, including California, Locsin says. Normally all licensed drivers in a household are listed for all vehicles, and some states do not permit driver exclusions. If in doubt, contact an insurance agent.

If you’re splitting coverage, you’ll save money by assigning the car that’s the cheapest to insure to the spouse with the bad driving record.

Why poor credit could make a difference
Most states allow insurance carriers to consider credit as a factor in determining car insurance premiums. Only California, Hawaii and Massachusetts prohibit it.

That means that in most states you can get a lower auto insurance rate if you have a high credit-based insurance score, meaning you pay your bills on time, apply for credit responsibly and keep your credit card balances low.

If you or your spouse has poor credit, you might save money by getting separate policies, says Ryan Andrew, president of The Andrew Agency in Richmond, Virginia.

In Virginia, for example, all drivers in the household must be listed on the policy, with no exclusions allowed. But your spouse’s poor credit may not count against you as much if he or she is a “listed driver” rather than the “primary driver.”

If you have two cars, you might save money by making the bad-credit spouse the primary driver for the vehicle that is least expensive to insure.

This is where a good insurance agent can help you find the best strategy.

“You really have to play around with it,” Andrew says. “It’s constantly changing. We just have to quote it and see where the chips fall.”

Sports cars might deserve a separate policy
You also might save money getting separate policies if one of you owns an exotic car that is expensive to insure, but in most cases the multicar discount will still make it cheaper to combine cars on one policy, Andrew says.

Locsin says he has clients who will get a separate insurance policy for a sports car and exclude the spouse if the spouse never drives it anyway.