Most insurance companies will automatically include all members of your household on your auto insurance policy. However, in some cases, it may be easier for each resident to have his or her own insurance plan. This may be the best option to avoid exorbitant insurance rates if your spouse has a bad driving record. There are several reasons to exclude a member of your household from your auto insurance.
Bad Driving Record
If you’re a great driver, but your spouse has a bad driving record, it is recommended that you keep your policies separate. At-fault collisions, DUIs, and reckless driving can increase your annual premium.
Even if you are both good drivers, there are special situations that may require that you keep separate policies. For instance, if your spouse drives a high-performance car and you drive a minivan, you may want separate policies. If you buy auto insurance together, your rates will increase to cover the greater risk of a luxury vehicle. Another instance where you may exclude your someone from your policy is if you work from home and don’t drive as much as a member of your household who has a long daily commute.
You can list your spouse as a secondary driver, even if they have their own car. Auto insurance covers the car, not the individual. If an accident occurs while your spouse is driving your car, your insurance will cover damages. But if you haven’t identified your spouse as an occasional or secondary driver, your insurance provider may resist payment. It is much safer to have the name of your spouse on the policy.
You can also specifically exclude your spouse from your policy. The implication here is that your spouse cannot drive your car, even in emergency situations. If they do, your insurer will not provide coverage for any damages.
Making a Decision
It is not compulsory for you and your spouse or other household members to combine insurance policies, but it’s usually the smartest financial decision. If you and your spouse have good driving records, buying auto insurance together is the best option. Having both cars insured by the same company will save money, and may even qualify you for a multi-car discount. Consider your specific circumstance to make a decision that benefits you both.