From Joint Policies to Individual Coverage: Car Insurance After Divorce

Going through a divorce is emotionally and physically draining. It marks a significant transition in your life, especially if you have been married for a long time and share children and substantial assets. While property ownership and child custody arrangements probably rank among your top considerations, car insurance is another critical factor.

Married couples usually have joint car insurance policies. However, a divorce means you probably can't keep your same insurance policy. You'll need to cancel your existing policy and get new individual car insurance coverage in your name. In this article, learn how car insurance after divorce works and how to avoid a lapse in coverage.

What are the immediate steps to take with your car insurance following a divorce?

A divorce can take anywhere from a few weeks to several years to finalize. During that time, you may not know how the courts will divide your property, including shared vehicles. While you can continue with a shared insurance policy during the separation period, you may need a new one if you or your ex-partner moves out of the family home. 

You may be able to wait on getting a new policy if both you and your soon-to-be ex-spouse still reside at the same address. However, once the divorce is finalized, you'll want to get your own insurance coverage.

Here are the steps to take to update car insurance post-divorce.

1. Identify your new address

Once you move out of the marital home, you must update your insurance policy to reflect your new address. Your insurer may ask for verification of your new address, such as a rental lease, bank statement, utility bill, or pay stub. You'll provide the documentation when purchasing a new insurance policy.

2. Shop around for insurance quotes

No rule requires you to keep the same insurer after a divorce. In fact, it's an excellent time to shop around for new insurance since you may lose a few discounts that currently lower your policy premiums. 

Consider requesting a few quotes from different providers operating in your state. Make sure you request the same coverage from each provider to compare rates accurately.

3. Get your spouse's approval to cancel the shared policy

Most insurers will only let you cancel a shared car insurance policy with your spouse's approval. You may need to get their written consent before insurers will cancel it. Contact your insurance company to see what type of verification they need to cancel the policy.

4. Start your new insurance before or on the same date as canceling your shared policy

You want to avoid any coverage gaps when shifting your insurance policy. Before canceling the shared policy, you and your ex-spouse should have independent coverage. You can set the new policies to begin on the date you cancel your shared policy or anytime before that date. 

How do you split a joint car insurance policy into individual plans?

Most insurers will not split a joint car insurance policy. Instead, you and your ex-spouse must apply for your own coverage. To start the process, decide whether you want to keep your current insurance provider or explore your options. Shopping around may help you find affordable rates. 

You can cancel the shared policy once you and your former spouse purchase individual policies. Your insurer may require both of you to consent before separating joint car insurance.

What factors should be considered when choosing a new car insurance provider post-divorce?

There are several things to consider when selecting a new car insurance provider.

Your living arrangements

If you plan on continuing to live with your ex-spouse following a divorce, you may not need to get a new policy since your vehicles will stay at the same address. However, once you or your ex moves out, you must get a new policy reflecting your new address.

Available discounts

You may lose some of the savings under your old policy, especially if you bundled different types of insurance, like homeowners and life insurance coverage, or shared multiple vehicles. Consider the discounts available through a new insurance provider. If you need more than auto insurance coverage, you may qualify for a bundling discount under your name.

Whether you have teen drivers

You and your spouse may need to add your teen to each of your policies if you share custody and they drive both of your vehicles. However, if your teen has their own car, their coverage depends on where the vehicle is primarily stored. If they mainly live with you, you'll need to add them to your insurance policy.

How does a change in marital status affect car insurance rates?

A few factors can impact your car insurance rates after a change in your marital status, resulting in higher costs. A married policy may be anywhere from five to 15% cheaper than individual coverage. Some factors that impact your car insurance rates following a divorce include the following.

Driving history

If you have a history of insurance claims or driving tickets and your spouse doesn't, you won't be able to benefit from their squeaky-clean driving history, which may increase your rates.

Location

Insurers consider your geographical area when pricing premiums. You may face higher rates if you move from an area with fewer accidents and car theft incidents.

Multi-car discounts

You might have received a multi-car discount if you and your spouse shared multiple cars. You won't benefit from the extra savings if you only insure one vehicle.

Policy bundling

Many insurers offer discounts when you bundle multiple insurance products, such as auto and homeowners coverage. However, when you switch to a new provider, you may only receive a bundling discount if you buy other insurance products.

What documentation is required to update or change your car insurance post-divorce?

Once a court finalizes your divorce, you must update or change your car insurance if you or your spouse no longer share the same residence. You may need to provide a copy of the divorce certificate to cancel a shared insurance policy. Insurers may request your spouse's approval before canceling the existing policy.

If you decide to stick with your insurer, you must provide evidence of your new address before initiating a new plan. Usually, a copy of a pay stub, lease agreement, or utility bill is enough to verify your address. 

Customers who choose a new insurer will need to verify their address with similar documentation. You may also need to provide a copy of your valid driver's license, the vehicle's identification number (VIN), and make and model details.

Frequently Asked Questions