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Factors That Affect Auto Insurance Costs After Divorce

Man driving a car
When setting premiums, insurance companies look at a number of different risk factors - several of which may be impacted by divorce - to assess how likely you are to file a claim and cost them money. Consequently, auto insurance rates can go up or go down following divorce.

Loss of Marriage Discount

Auto insurers generally consider marriage a sign of responsibility; therefore, many offer a discount to married drivers. Insurers base this particular factor on statistics they collect showing which groups of drivers are more likely to be involved in an auto accident.

Gender

If you're a woman, your gender alone may get you a lower auto insurance premium after divorce, as research suggests that women tend to be safer drivers than men. Data show females generally are less likely than men to be aggressive drivers. Reports indicate women also have fewer traffic violations and file fewer insurance claims, often for lesser amounts than what men file.

Driving Record

Insurers consider the driving records of both spouses. If you have no blemishes on your driving record but your spouse got a few tickets or was the driver at fault for an auto accident while you were married, your rate may go down after your divorce. However, if you are the ex-spouse with the imperfect driving history, you'll likely pay a higher rate.

Credit Score

Credit scores go into the premium calculation as well. If you're the ex with the higher credit score, chances are the cost of your auto insurance will go down. However, if you have the lower credit score, you may see your rate go up even if you have no accidents or traffic violations on your driving record.

Along with your driving history, insurers look at your credit score as a way to determine whether you are likely to file an accident claim. They use the score they come up with in addition to other key factors to calculate the cost of your annual insurance premiums.

Location

Location is another factor insurers consider. So if you move to another location after you're divorced, the insurance rate you pay may change. For example, if you move to an area where the crime and vehicle accident rates are lower than that where you lived previously, you may see your premium rate go down.

Conversely, if you relocate to an urban area - where the risk of auto theft is likely higher than in a rural or suburban neighborhood - your rate may increase. Areas prone to hurricanes, floods, tornadoes, or earthquakes can increase your auto insurance too.

Relocation Out of State 

Moving out of state is another factor that can affect your auto insurance rate. Some states require higher minimum property damage and bodily injury liability limits, which can mean a higher premium than you paid in your former state of residence.

But this may be a good thing so you don't find yourself lacking adequate insurance coverage. Otherwise, if you're involved in an at-fault accident, once your insurance company pays up to the limits stated in your policy, you'll have to pay any difference out of your own pocket.

Level of Liability Protection

Depending on the amount of the assets you have to protect, you may want to carry more coverage than the minimum insurance requirements for the state in which you reside. Even if you go with a different insurance company after your divorce, it may not necessarily cost you more. Some insurers offer discounts to new customers who take out higher liability limits than they had on their previous policies.

Whatever your insurance needs as a single, married, or recently divorced individual, contact S.N. Anthony Insurance Inc. for help in determining the extent of coverage you need. We are ready to discuss coverage options that fit within your budget.