Insuring Two Cars for One Driver
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If you have several cars, you might wonder is insuring two cars for one driver possible? If you do have several vehicles, you can usually insure them all in your name. In most cases, insurance companies will allow a single driver, who doesn’t own a fleet of cars, to insure as many as four cars on a single policy.
To keep expenses down, insurance companies allow policy owners to bundle policies. Typically, if you have two cars on a single policy, you will receive a discount of 10% to 25%. The more cars that are added to your policy, the more the discount will increase.
This makes it a less expensive option than getting separate policies on all your vehicles. With that being said, insurance is a complicated topic, especially when you consider that insurance laws vary from state to state. This is why it is important to comparison shop when looking for car insurance policies for multiple vehicles.
If you have two cars to insure, you should consider how often you drive them and how far you drive them. For example, you may drive one car back and forth to work Monday through Friday. However, you may prefer to drive a different car on the weekends. In this case, you probably drive your work car considerably more (and longer distances) than your weekend car.
Do you need to insure the cars at the same rate? Your best option may be ‘pay by the mile’ insurance, which allows you to pay based on the distance you drive. On the other hand, if you start to drive your weekend automobile more, this type of policy may not make sense.
Perhaps you’ve decided to purchase a new car, but want to keep your current one for a little while longer. In this case, your new car will probably need to have more coverage than your old one. For the new car, a policy that includes collision, comprehensive, and liability coverage is necessary.
However, liability coverage may be all your older car needs because it will cover property damage and bodily injury. This means that your insurance will not pay to repair your older car if an accident occurs. It will also not cover damage caused by falling objects, natural disasters, or animals.
Theft is also not covered. (Because you have comprehensive and collision coverage on your newer car, damage from an accident, falling object, natural disaster, animal, or theft would be covered.)
If you own a classic car, as well as an everyday vehicle, most companies will cover both on a single policy. However, you do have the option of insuring them on separate policies. This may be a good option if you rarely drive the classic car, but want to ensure it is protected from flood, theft, or fire. You can get a policy for a classic car that is specifically for storage and this will help cut your premiums down quite a bit.
This policy doesn’t cover you driving the classic car on the road. If you do drive it and are involved in an accident, you will be responsible for the repair costs, as well as possible legal fees, fines, and more.
If you are driving a classic car that only has storage coverage and you cause an accident that kills or critically injures someone, you could face significant legal charges. (Of course, this is the case if you are driving any vehicle and cause an accident.)
If you own one car, such as a convertible, that you only drive during certain seasons of the year, you can have them covered on the same policy. However, you do have the option of not insuring your seasonal vehicle during the off-season and storing it instead. In this case, you would need to report your lapse in coverage to the state and return your license plate.
Perhaps you own a single car with another person. For example, maybe you are newly married and plan to share a vehicle with your new spouse. You may be tempted to both have your own insurance policy on the vehicle.
However, this isn’t necessary and is usually a waste of money. Instead, you should look for a joint policy that allows both of you to keep the coverage you need to be protected. It’s also important to understand that having two policies on a single car can be viewed as insurance fraud, specifically “unjust enrichment.” This occurs if one of the two insured drivers has a covered loss and attempts to file claims with both policies.
You could be subject to fines and possibly jail time. Another instance in which two people may try to cover the same car could involve a family with a teen driver. He or she may be getting their first insurance policy, but the parents feel that they should also get a policy to make certain there is sufficient coverage in the event of an accident. If any family member could end up driving the car, a multi-driver policy should be considered.
If there are multiple drivers in your home, it’s important to understand how these additional drivers can affect your car insurance policy. A car insurance policy for multiple drivers is similar to a policy for a single driver.
All potential drivers should be included on the policy. As long as someone pays the bill, there should be no issue with your coverage. The only thing that makes a multi-driver policy unique is how each driver’s individual driving history will affect the policy.
Insurance companies cannot distinguish risk distribution among each driver on the policy. This means that if one person has a poor driving record, the premium will be higher. If you later decide to split up the policy, their driving record will not continue to follow you.
If you are a parent, you do have the option of excluding your teen driver from your policy. This could be important if they get a ticket or are involved in an accident, which could raise your premium drastically.
It is strongly suggested that you discuss this with your insurance agent before making a final decision. In some situations, such as when you have a child who goes away to college, you may want to continue covering them on your multi-driver policy. This can be done by adding them to the policy as a “non-resident driver.”
A non-resident driver is defined as someone who doesn’t live in your home but frequently drives the vehicle. The definition of “frequently” when used to describe a driver who uses a car usually refers to more than 12 times in a single year.
However, this definition may vary from one insurance company to another. Regardless of how many cars you own or how many drivers you want to cover, also take the time to comparison shop to ensure you get the best deal.