It can be expensive to insure one car. But what if you have multiple cars? How do you find the best and lowest priced car insurance?
For starters, most insurance carriers will allow you to put up to four cars on one policy for a bundled discount. For example, if you and your spouse each drive a car and your teenager drives another one, you can put all three vehicles on one policy. You will typically get a multi-car credit and pay a lower premium than if each person had a separate policy on each car, says Aimee Goddard, vice president of Eastern Insurance Group in Natick, Ma.
On some occasions, it may be less costly to keep the multi-car policy for the cars driven by the parents and get a separate policy for the teenage driver, says Goddard. The best thing to do is shop around or have an insurance company price it out both ways, she says.
3 common concerns with multiple cars
To help you better understand insurance options with multiple cars, here are 3 common situations:
1. You are married with two cars. You drive one car and your spouse drives the other. Will your multi-car rate be based on who drives which car most often or is it based on having two cars in your household? Are there other ways to save money?
Typically it doesn’t matter who drives which car as your rate will generally be based on the vehicles and the number of licensed drivers living in the household. Most insurance carriers will recommend that both drivers be listed as primary drivers on both cars.
In some instances, you may want to list your spouse as an occasional driver of your primary car as this may save you money. However, this isn’t recommended because if your spouse is in an accident while driving "your" car and the insurer deems him a principal driver, the claim could be denied.
On the flipside, if your spouse truly doesn’t drive your car, you can save money by excluding him from your vehicle entirely. To do this, you will usually have to submit a form signed by both of you. This will state that your spouse will never drive your car. "We don’t usually recommend this but we do inform clients about it," says Goddard.
2. You have two cars and one is a classic car that you rarely drive. Can you get a lower rate?
Combining your antique car on the same policy as your daily vehicle will usually result in a lower multi-car premium. But, if you don’t drive the classic car at all for a period of time, you could unregister the vehicle and drop your liability coverage. It’s still a good idea, however, to maintain minimal comprehensive coverage in case it’s stolen or destroyed in a flood or a fire.
Another insurance option would be to insure your classic car with a specialty antique car policy, often designed for cars driven infrequently to car shows or other events. Many major insurance companies, as well as specialty insurers like Grundy Worldwide and Hagerty, offer classic auto insurance. To find out whether you’ll save more money with one policy for both cars or a separate policy for your antique vehicle, it’s best to shop around and call your insurer.
3. You have two cars but you switch off driving one at a time. Do you still have to insure both cars all of the time?
You may find yourself in this situation if you buy a new car and hold onto your other car until your teenager gets his license. Or, maybe you drive your four-wheel drive SUV in the winter and your convertible in the summer.
In situations like this, you may think you won’t drive one of your cars for a period of time. But, if you do drive it with no insurance and get into an accident, you could be in a financial pickle.
Instead, experts recommend insuring both vehicles and discussing a multi-car discount with your insurer.
Image: Chad Horwedel