Auto Insurance and Life Changes
Written by Michael Browne
There are many milestones on the road of life - turning 18, 21, and 25, getting married, having a baby, buying a home - did you know that every one of these things can affect your auto insurance? Here's a brief overview:
- Growing Up: We all know that young drivers are the most expensive to insure. While turning eighteen or twenty one doesn't automatically guarantee you a drop in the cost of your car insurance, both of those ages are associated with events that can affect your premiums. Eighteen-year-olds, for example, are typically in or headed to college. If you're going to a campus at least 100 miles from home, and leaving your car behind, you can actually put it into a special "college driver" status that only allows you to drive it during school holidays (including summer vacation), but saves a lot cash. At twenty-one, graduation is looming, and it may be time to consider moving off your parents' insurance, and getting a policy in your own name. While this may be a bit more expensive, it means that you can qualify for your own good driver discount, without losing any good student discount as long as you're still in college. The age of twenty-five, of course, is the upper threshold for being considered a "young driver," and once you reach that age, your perceived risk, and the cost of your premiums, should be significantly reduced.
- Getting Married: If you're under the age of twenty-five when you marry, you'll likely see some drop in the cost of your insurance because married couples are perceived is being less of a road-risk than single men and women. If you're twenty-five or over, and you each have a car, putting them on one policy can earn you a multi-car discount. Just be sure that both of you have good credit and good driving records before you merge your insurance.
- Having a Child: There's no direct impact on car insurance for having a baby, but it's important to rethink what you're driving. That cute sports car you've had since college may not have a LATCH system, for attaching a car seat, and if you're a single parent you'll need to make sure you disable the front passenger airbag until your older child is over five feet tall, or over twelve years old (or both). Also? Make sure that brand new SUV or minivan has anti-theft devices, electronic stability control, and anti-lock brakes for the best possible rates.
- Buying a Home: While home ownership does mean a bit of an increase in auto insurance - you'll need to boost your liability coverage to protect your home from being lost in a lawsuit if you cause a serious accident - the ability to bundle your home and car insurance with one company will usually result in a discount on one or both policies, as well as the ability to make one monthly payment for all your insurance. Pay those premiums by electronic funds transfer, and receive emailed statements, and you can save even more!
If you're approaching the end of college, your 25th birthday, your wedding, the birth of a child, or the purchase of your first home, it may be time to adjust your car insurance coverage, so remember to consult your insurance agent…but only after you've celebrated with your family.