by exnewyorker » Wed Jan 30, 2008 06:38 am
I was divorced several years ago but my ex-wife and I continued our joint auto insurance because it's cheaper (for her; as I have the better record) than us buying separate insurance. I'm willing to continue this arrangement to save her some money, but... Is this legal? We both live in California.
Thanks.
Thanks.
Posted: Wed Jan 30, 2008 12:08 pm Post Subject:
You know, I really don't know about this one....If the policys say you are residents of the same household or that you are married (premiums on younger people are cheaper when married generally)...that could be a problem...hopefully ins teacher or another more versed in these types of questions will be along shortly with more information.
p.s. nice of you to try and help even after the divorce... :wink:
Posted: Wed Jan 30, 2008 04:53 pm Post Subject:
Let me start by saying, "legal" is sometimes a question for the court... and extremely few things get that far.
You both need to have an insurable interest in the vehicle you're driving. I think you both do in this case. The problem is, as mentioned, I doubt you're living in the same household. But have you ever lied on an application about this? I doubt it, as most carriers don't even bother to have their insureds fill out updated paperwork (I'm not ruling it out though).
Of course, you are still "representing" yourself as being married and enjoying a lower rate because of this. You probably have a certain responsibility to inform the carrier that this is no longer the case but I can't see not doing this as grounds for any denials... they would simply non-renew your policy.
I can see a few problems though... if one of you does not live in the same area where the policy was issued (city), or even another state, this could create a problem. I don't see that it would exclude coverage though. Also, any payment issued for damage to your ex-wife's vehicle is going to be made payable to you.
Posted: Thu Jan 31, 2008 11:01 am Post Subject:
Also, any payment issued for damage to your ex-wife's vehicle is going to be made payable to you.
AND visa versa!Posted: Thu Jan 31, 2008 11:44 pm Post Subject:
You both need to have an insurable interest in the vehicle you're driving. I think you both do in this case.
I disagree. The only way that you will have an insurable interest in this case is if BOTH vehicles are titled in BOTH names. While this may be the case, I doubt it since the divorce. Chances are that each of you has the vehicle you drive titled in your own name.
Other problems exist as to where the vehicles are garaged. Chances are you will not find a carrier willing to insure a divorced couple on one policy when the vehicles are garaged in different territories- it lends premium rating problems to the equation. Keep in mind- I never said "never" as to this possiblity occuring...I just don't know of any carriers that would do this, but I certainly don't know every insurer's rating criteria.
Next, Lori brings up a good point:
If the policys say you are residents of the same household or that you are married (premiums on younger people are cheaper when married generally)...that could be a problem
My feeling is that you are already past the cut-off point as to when being married has any effect on your premiums, unless you are both under age 25. Most carriers state that marriage will only affect the rate if you're under that age. Differences between companies exists here, but that's the norm. Now, on the other hand, if you're maintaining the policy simply to get a multi-car discount- the insurer will have a problem with this. Most insurers require that the cars be garaged at the same resident address. The only typical exception to this rule would be a child taking a car with them to college or something similar to that.
In the event of a loss, the policy may or may not pay. Most insurance policies have language that says that if the risk substantially changes, you are required to notify the insurer. This, in my opinion, is a situation that would be material to the carriers decision to insure, and could be construed as a material misrepresentation in that you are in effect, by paying the premiums, stating that you are maintaining the same arrangement as existed prior to the divorce. This is a stretch, but could occur.
The real problem that I have with this deals with your potential liability should she get into an accident that's truly serious. Let's say that your ex-wife causes a very serious accident and injures another person badly, or kills them. Since you are on the same insurance policy, the likelihood is that you would be included in any civil proceedings that would be brought against your ex-wife, and could be held financially responsible for her actions. It would be difficult at best to convince a jury that you kept the insurance policy in force for years as a "couple" and now want, in the event of a serious accident, to be considered "separate" persons for liability purposes.
I'll be the first to admit I'm no lawyer, but I have a feeling that in the event that if what I described above occurs, you'll be needing one.
Do yourself a favor- tell her to get her own insurance, and make sure that the car she drives is in her name and her name ONLY. While I appreciate the idea of you wanting to help your ex-wife, I think that this can only end up badly if you continue on the same path.
Any other thoughts?
InsTeacher 8)
Posted: Fri Feb 01, 2008 03:53 am Post Subject:
I read this again, and wanted to add something.
tcope has some good points:
I doubt it, as most carriers don't even bother to have their insureds fill out updated paperwork (I'm not ruling it out though).
Of course, you are still "representing" yourself as being married and enjoying a lower rate because of this. You probably have a certain responsibility to inform the carrier that this is no longer the case but I can't see not doing this as grounds for any denials... they would simply non-renew your policy.
I can count on one hand the number of in-force personal lines automobile insurance policies that have ever really been audited, or have the owner/insured submit paperwork after the initial application. The obvious exception to this would be paperwork involving a claim, or proof of loss statements, etc. Also consider the line of insurance in this argument.
Secondly, tcope brings us the idea of you still representing yourself as married. Don't make a mistake- many people think that the only time they have to provide information is on the initial application. Wrong. You are under the requirement to inform your company of these kind of changes.
The best advice I can give you is to thoroughly read your policy. You shouldn't have problems with the language, just fight through it. Just remember that these type of policies will give you coverage for something on one page of the policy and then take that coverage away under certain conditions on another page of the policy. I'm sure that many of the veteran agents, and especially claims people will verify that statement! :D
InsTeacher 8)
Posted: Fri Feb 01, 2008 03:54 am Post Subject:
that last message was mine...i SWEAR that I had logged in. I feel cheated. :?
Posted: Fri Feb 01, 2008 12:17 pm Post Subject:
that last message was mine...i SWEAR that I had logged in. I feel cheated.
I was having trouble last couple of days too getting thrown back...I reported it and seems better today...If I had ''the power''' I'd ''adjust'' your accounts... :wink: alas, I have no such power...I agree totally
I disagree. The only way that you will have an insurable interest in this case is if BOTH vehicles are titled in BOTH names
This is the only way I see an insurable interest on the OP's part...and both spouses are assuming some dangerous liablity of the other...Let's not forget as well if ex has a boyfriend driving her car, or whomever, you are still party to that.... :twisted:Just an fyi taken straight from an auto policy:
YOU MUST INFORM US IMMEDIATELY IF ANY OF THE FOLLOWING CHANGE DURING A POLICY PERIOD:
1/ The discribed auto
2/ The indiduvals who regulary operate the described auto
3/ Any changes in the number of licensed drivers in your household
4/YOUR MARITAL STATUS
5/YOUR RESIDENCE ADDRESS
6/THE PRIMARY LOCATION OF THE DESCRIBED AUTO.
I subscribe to the ''better safe than sorry'' logic, I'd change this yesterday!
Posted: Fri Feb 01, 2008 04:54 pm Post Subject:
There is a difference between "insurable interest" and ownership. Many people don't realize that. You have an insurable interest as long as you stand to loose something if the vehicle is damaged. So if it's your main means of transportation, you have an insurable interest. Another way to look at it is that lacking an interest in the vehicle, it becomes more of a lottery policy.
Lori, that is a terribly written policy :wink: It's also a modified policy. Knowing that such changes can exist, I would certainly go back a little on what I said and agree, the OP needs to check his policy.
Posted: Sat Feb 02, 2008 12:45 pm Post Subject:
Lori, that is a terribly written policy
:lol: That's MO for ya'! maybe it was the typist! ha ha...no I typed it exactly, from an area in the policy....I understand there is a difference between ownership and insurable interest...I also understand all wouldn't....I'm not sure though that I'd see the OP's insurable interest on this....course it could exsist I guess if he was left with the note and she with the car in the divorce..(ouch) :wink:Posted: Mon Feb 04, 2008 06:10 pm Post Subject:
tcope, I disagree big-time with this:
You have an insurable interest as long as you stand to loose something if the vehicle is damaged. So if it's your main means of transportation, you have an insurable interest.
According to your logic, if I rely on a ride to work everyday with a friend, that would be my main means of transport, so based on your argument, I could insure my friend's vehicle. Sorry...never gonna happen. When considering P&C, insurable interest is defined as follows:
1. owner of property has an insurable interest because of the expectation of monetary loss if that property is damaged or destroyed.
2. creditor of an insured has an insurable interest in property pledged as security
Insurable interest has to exist both at the time of inception of the contract and at the time of a loss. You can insure the home you own with a homeowner's policy due to the insurable interest in the home. If you sell the home, you cannot insure it due to the lack of financial interest in the home. This definition is provided by the Barron's Business Guides: Dictionary of Insurance Terms. Quite accurate, by the way...
Another way of looking at this would be using the example of needing the friend to drive you to work, and if the car was wrecked etc. In P&C, insurable interest is defined as "financial" loss, and not loss dealing with "inconvenience" as would be suggested in this example. While it may be a royal pain not to have your regular ride to work, you (as the rider) would NOT suffer a financial loss to the insured object in the event of a loss. Therefore- NO insurable interest. Only the "friend" who owns the car stands to LOSE (not LOOSE) financially.
Sorry- when something is LOOSE, it's not TIGHT. You LOSE something when you don't know where it is. Sorry- it's just that writer thing in me that goes crazy with bad spelling and grammar.
InsTeacher 8)
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