Is It Possible for One Vehicle to Have Multiple Policies?

Is It Possible for One Vehicle to Have Multiple Policies?

Having a strong auto insurance policy is important because it covers you from potentially severe financial losses if your car is stolen or totaled. Purchasing insurance is also a legal requirement. In some cases, you may seek to purchase one policy that includes several types of coverage. On the other hand, maybe your circumstances have changed, and you are considering purchasing another policy for your vehicle.

Are Two Policies Legal?

Having two policies on one vehicle is not against the law. However, there’s a strong chance that your insurance carrier is not interested in insuring the same vehicle multiple times. You will likely have to purchase the other policy from another carrier. This means you’ll be obligated to pay two separate bills. Some drivers add a second policy because they think their previous one expired. Other people add another policy because they have a classic car. Be aware that it is illegal to file a claim with two insurers regarding the same issue. If you receive compensation from multiple providers regarding the same claim, that is classified as fraud.

Possible Weaknesses of Double Coverage

Things can become complicated if you co-own a car with someone and each of you purchase coverage from a different carrier. It can be difficult figuring out which insurance company should cover the damages if the vehicle is involved in an accident. Hit and run accidents are another common problem. If both you and your co-owner are in the vehicle when the accident occurs, filing a claim becomes complicated.

Sticking to One Policy

If you have multiple insurance policies, you risk violating terms with your carrier. Look over the clauses in your policy. If your insurer suspects something fraudulent is going on, they may decline your claim. Sharing a policy with your co-owner can help you avoid a lot of confusion. Both names will be listed on the policy, and you can split the costs.

Insurance Fraud Detection

Having double coverage on a vehicle is not an automatic sign of insurance fraud. However, your insurer may seek to prove insurance fraud if they have evidence that you have illegally benefited from the claim payment.

Things to Consider

Having multiple insurers cover your vehicle could lead to delayed or unpaid claims in the future. You can add anyone who stays at your residence to your insurance policy. Adding another driver to your policy may increase your premium, so inquire about potential discounts.

If you are in a relationship, but your significant other doesn’t live with you, you can add a permissive use clause to your policy. A permissive clause allows drivers who don’t live with you to use your vehicle and still maintain coverage. The permissive use clause is only expected to be used occasionally. If someone frequently drives your car, you are better off simply adding them to your policy. If your significant other has a poor credit score or driving record, adding them to the policy may cause your premium to rise. Having a separate policy from your partner is also a good idea if you have a high-end vehicle.

Consult with 01 Insurance

Having multiple policies on a vehicle may complicate things when an issue arises. Evaluate your situation carefully before making this decision. If you have any questions about your insurance policy, our team at 01 Insurance is here to assist you. Contact us today to learn more!