A wedding and honeymoon can be a whirlwind for newlyweds but tying the knot means some significant financial changes that weren’t considerations during your more carefree single days.
As couples unite in Holy Matrimony, so too do their finances and liability. For these reasons, it’s important to make sure your insurance reflects this major life change and your new marital status. The best advice is to contact your insurance agent to discuss any coverage questions.
Here are some insurance considerations before you say: “I do.”
“The Talk” About Your Auto Insurance
Saying you should have “The Talk” prior to getting married means many things to many people. In this case, we’re referring to your car insurance.
First, if your husband- or wife-to-be has a lead foot and racks up speeding tickets like they’re going out of style, you should consider separate auto insurance policies. Combining coverage may or may not be more expensive for you. Carefully price out what separate policies would cost you and provide for coverage.
Now that you’re combining assets your auto insurance should provide enough liability protection to harden your finances against a lawsuit - should you be involved in an accident while driving.
If your soul mate is a terror on the roadway, you might also consider a “named driver exclusion,” which is available as an endorsement added to your insurance policy. This exclusion states the named individual is excluded from your insurance coverage (perhaps this may not start the marriage out on the right foot, but it’s good to know you may have options).
Sharing your toys
Your new spouse most likely will share your other household items, including your ATV, boat, personal water craft or even your RV.
These recreational “toys” usually require insurance coverage. Discuss whether you have enough coverage to protect your assets. You may lower your premiums by having the right safety equipment and courses your spouse may need before getting enjoying your recreational devices.
Protecting Home Sweet Home
If you aren’t living with your new spouse before you get married, odds are that you will be afterward. The spouse who moves in should cancel their home or renters policies after they vacate the premises and ownership is transferred to someone else. If you’re putting the house up for sale or leaving it vacant for a period of time - the property still requires insurance coverage so make sure you discuss this with your agent. If you plan to rent it out, remember that you’ll want to obtain coverage as a landlord.
For newlyweds who plan to purchase a home or rent a new apartment, remember to factor in insurance costs. A home in a bad neighborhood, or one that requires a higher-risk flood insurance policy, will cost you a lot more in insurance. Houses with modern construction, safety features, and located in towns with strong fire coverage and hydrants nearby will most likely cost you less in insurance premiums.
Another consideration is whether you need a “floater” or “endorsement” policy to cover jewelry, including that expensive engagement/wedding ring. A standard homeowners policy typically covers personal items for 50 to 70 percent of the home’s structural coverage, according to Allstate insurance. This means that if your home has $200,000 worth of insurance, you’ll have about $100,000 to $140,000 coverage on personal items such as clothes, computers, and other items. Jewelry is covered too but there is a limit typically between $1,000 and $2,000 per item. To ensure your jewelry is covered, have a written appraisal and add a rider onto your homeowner or rental policy.
Don’t forget your umbrella
People are tying the knot later in life when they have more assets to protect. Just consider that during the last 25 years, the average age a man gets married has increased from 26 in 1990 to 29 in 2013 and women from 23 to age 27.
Income levels and assets grow as we get older too. An umbrella policy provides excess liability protection beyond what your homeowners or auto policy covers, according to Travelers Insurance. In other words, this policy kicks in if a judgment against you exceeds your policy limits.
It’s best to calculate your assets and then decide whether you need this extra level of protection.