The U.S. Census Bureau estimates that unmarried couples living together is actually more prevalent than marriage; in fact, the statistics show that the number of unmarried couples living together exceeds 8.3 million and will continue to rise. One main reason for couples choosing to live together is to save money; however, what some may not know is that it could cost them even more if they aren’t informed of exclusions, provisions, and limitations under their Alabama auto insurance policy. In order to avoid some potential financial consequences that could be devastating, find out more about unmarried couples and car insurance.
A Typical Scenario That May Happen…
Accidents happen all too frequently and there is nothing worse than hearing AFTER the fact that you have inadequate insurance, gaps in your auto insurance, or a specific exclusion that you never considered. So, consider this…
You and your girlfriend reside in the same household and both of you have your individual cars with separate auto insurance policies. One day your girlfriend heads out to run errands and because your car was parked behind hers, she just takes yours and guess what? She failed to stop at a red light and caused an auto accident in YOUR car. Despite what you may think, auto insurance in the state of Alabama follows the vehicle and not the driver, so in this case YOUR insurance is the one that is primary here.
As a result of the auto accident, the other driver incurred medical bills that exceed $100,000 yet your limits are only $50,000. So, here is where the problem lies. The insurance on the car would normally cover the first $50,000 but since the car is regularly available for your girlfriend’s use, your Alabama auto policy doesn’t have to pay anything leaving you responsible for the balance. For most people, this would be financially devastating!
Policy Provisions, Limitations, and Exclusions
A standard Alabama auto insurance policy comes with many specific provisions, limitations, and exclusions so if you have an auto accident, you may be surprised how you could be affected. Your auto insurance policy provides liability coverage for bodily injury and property damage to others (up to the chosen limits of liability) resulting from an accident you cause. The coverage is provided for the named insured, his or her spouse, family members residing in the household, and other drivers listed on the policy. It also deems any other person as an “insured” while that person is occupying a car (with permission) that is insured under your policy.
However, if you continue reading, there are exclusions and provisions when you have someone who is operating the vehicle on a regular basis. Consider whether you or your roommate drives the others’ car on a regular basis or just periodically when the situation dictates. The standard Alabama auto insurance policy specifically excludes the “named insured” or spouse when driving another vehicle furnished or available for regular use.
Burkett & Associates Insurance Agency Has Options!
Being informed on all specific verbiage in your auto insurance policy is how we can provide the best protection for you should you be in an auto accident. One option, as an unmarried couple, is to simply add one another to the other’s car insurance policy as a driver in the household.
The other option is to combine both cars into one auto insurance policy. Not only will this give each of you the same liability amounts but could mean savings up to 25% for a multi-car discount!
Not knowing about policy limitations, exclusions and provisions could leave you in a coverage gap that could jeopardize your financial well-being. We are here to assist you in every way regarding any of your Alabama auto insurance needs. Call us TODAY at 256-704-7400.