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How Does My Marital Status Affect My Car Insurance Rate?

By September 30, 2014October 2nd, 2018Auto Insurance

Being single has its advantages. A lower rate on your car insurance isn’t one of them. Your marital status is one of several factors that car insurance companies look at when they calculate your rate.

What the companies are trying to do is predict how big of a risk you are. They’re trying to determine if you’re more or less likely to get in an accident than someone else. One way they might do so would be to look at your life in detail – talk to your neighbors, your family, your boss to find out what kind of person you are and how likely it is you’ll get in an accident.

While that might seem more fair in some ways, it simply is not feasible for car insurance companies to interview your boss. So instead, they find information about you that, collectively, categorizes you into a group – say, 30-year-old single men living in an urban area who own sports cars.

Each of those facts about you –your age, marital status, sex, geographic location, car you own – have an effect on your car insurance rates. The insurance companies compile information that shows how each of those factors affects the likelihood that you’ll make a claim.

How Car Insurance Companies Determine Rates

Let’s look at a hypothetical example: Acme Insurance Company, like all car insurance companies, has in its records all the claims they’ve paid for customers who were single at the time of the claim. They also have claim records for all of their married customers. When they compare the two, they find that the married people make 22% fewer claims than single people. Since they don’t have to pay as many claims, they don’t need to charge as much for married people as they do for single people.

Another company, Zephyr Insurance, might have had a slightly different experience with the marital status factor – maybe their married customers had 19% fewer claims than single people. So technically, they shouldn’t be able to give as much of a break to their customers.

Ah, but it’s not just marital status that’s to be factored in, remember? It’s also the type of car you drive, where you live, how old you are, and many more factors. It all adds up, but it adds up differently for different car insurance companies. That’s one of the reasons that it’s smart to work with an independent agent who can sort through all of these factors and find the most affordable policy for you.

Marital Status May Affect Some Drivers’ Rates More than Others

Some people have more to gain from marriage than others – at least when it comes to car insurance. Those who are in the higher risk group, such as men under 25, are paying higher premiums than women of their age or older men. They’ll likely see more savings from getting married than, say, a 55-year-old woman.

Couples can also potentially save on car insurance after marriage by adding another car on an existing policy or by requesting a multi-vehicle discount. If they’re buying a home, adding the home insurance to their coverage also helps lower rates.

Newly Single Drivers: Caution Ahead

If your marital status goes from married to single due to a divorce or death, not only will your rates likely increase, you may be leaving yourself unprotected without knowing it. Car insurance companies base their policies on the where the insured vehicle is parked when it’s not being driven. If you’ve moved since your divorce or spouse’s death, be sure to inform the insurance company to avoid any problems.