Even Your Marriage Requires An Insurance Policy

NEW YORK (TheStreet) – To all of you couples getting married this month, congratulations — now you have twice as many things to worry about insuring.

Not to stomp on your wedding cake, but there are practical considerations that go along with all those weddings that take place in June. If a couple is bringing two cars into the relationship, is considering buying a home together or is wondering how to protect that two-months' salary that's sitting on one of their fingers, there's a strong chance they'll need to reconsider their insurance policies.

At the very least, they might want to consider the implications of borrowing each other's cars. Laura Adams, senior analyst for InsuranceQuotes.com, says automotive insurance provides couples a simple first step toward insuring their property jointly, if that's what they decide they'd like to do.

“The first thing to consider is auto insurance,” Adams says. “You want to make sure that both of you are insured for either car and that they can drive each other's cars. Typically family members are covered, but what I recommend is that you put each other's names on each policy.”

While couples are taking that step, it's a good time to look over each other's shoulders and see who's getting the best deal. If one member of a couple has been with their insurer far longer than the other, Adams says the loyalty discount they're getting might be beneficial to both. Adams advises taking a look at annual insurance costs and comparing the cost of multi-vehicle plans with their various insurance companies.

“A couple doesn’t necessarily use the same insurance company for their vehicles before getting married,” aid Richard W. Lavey, president of personal lines and chief marketing officer at The Hanover. “But it’s usually more convenient and can result in multi-car discounts if all autos are combined in a single policy with a single insurance company.”

If the results are promising, chances are they'd be even better if you bundled your auto insurance with either your renters' insurance or homeowners' insurance. As an InsuranceQuotes survey discovered last year, bundling insurance coverage saves policyholders about 15% on average and costs roughly $270 less than separate policies. Those savings fluctuate from 22% in Oklahoma and Missouri to just 5% in Florida, but even the slightest discount adds up to $116 less a year in Hawaii. Even if a couple doesn't own a home currently, bundling homeowners' insurance with automobile or other insurance will still be a fine idea when the time comes.

“From an insurance standpoint, the purchase of a home definitely should be insured and is the ideal asset you should have insurance on,” says Dan Yu, managing principal at EisnerAmper Wealth Advisors. “It is likely your largest asset, it would be financially devastating if it wasn't covered correctly and, quite frankly, you probably would not be able to get a mortgage without it.”

Plus, you'll need at least some form of renter's or homeowner's insurance to cover everything else you own, if not more. As Adams points out, homeowner's insurance will only cover goods including jewelry, silverware and artwork to an extent before a policy caps its value. If one of your belongings is worth more than the insurance company is willing to pay out, Adams and Yu note you'll have to add a rider to your policy to cover the additional cost. They're relatively inexpensive, but they can't help you if they aren't rolled into the greater policy. Adams also suggests considering your wardrobe and other seemingly inexpensive belongings as large lots of items worth insuring once you add up their value. Housewares, computers, electronics and even guns typically require more coverage than a homeowner's insurance policy offers.

“With advances in technology, it’s easier than ever to build a home inventory,” The Hanover's Lavey says. “It’s now as simple as taking out your phone, snapping pictures of your belongings and uploading them to a cloud-based application that stores them for safekeeping. This helps your insurance company identify what needs to be replaced if anything were to be damaged or stolen.”

Lastly, you could consider saving yourselves a lot of effort and aggravation down the road by making sure certain items and assets are jointly titled. If you own a car jointly or have joint brokerage or bank accounts, right of survivorship ensures that when one spouse passes away, the other spouse gets the jointly owned asset automatically. When you own a home in both of your names as joint tenants, meanwhile, that right of survivorship ensures that one spouse will automatically get the home if the other passes away.

“When you title things in joint property, depending on the state in which you live, from an estate planning perspective it kind of streamlines it,” Yu says.

— Written by Jason Notte in Portland, Ore.

To follow the writer on Twitter, go to http://twitter.com/notteham.

This article is commentary by an independent contributor. At the time of publication, the author held TK positions in the stocks mentioned.

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