Most auto insurance companies will give you a discount if you insure more than one car under one policy. As you would expect, however, you have to meet certain conditions to enjoy the discount. Below are some of these conditions.
Number of Vehicles
Although the discount requires you to insure more than one vehicle with the insurer, many insurance companies place a limit on the number of vehicles you can have on the same policy. For example, you may find that you can't insure more than four or five cars in the same policy.
This makes sense because the more vehicles you have on the same policy, the more it is difficult to assess the related risks, and auto insurance is all about risk assessment. Depending on the insurance company, you may have to purchase fleet insurance or buy more than one policy if you have more than five cars.
Use of Vehicles
From an auto insurance company's point of view, there are two main uses of vehicles. You can buy a vehicle for personal use or for business use. Personal and business vehicles face different risks, so they require different assessments and rates. Thus, for you to enjoy a multi-car policy, all the vehicles should be for the same purpose. For example, you can't insure your personal car, your spouse's car, and your company's car on the same policy to get the multi-car discount.
Most insurance companies will only give you a multi-car insurance discount if all the cars are in the same household. For example, you might not get the multi-car insurance discount if you own one of the cars, your child who lives in their bachelor pad owns another car, and your parents who live a few blocks from you own the third car. Some insurance companies will even require the owners of the car to be related, as well.
The liability coverage limit on all cars under the multi-car policy should be the same. This is not just a requirement of auto insurance companies; even state insurance laws demand it. The requirement is to avoid confusion and complications that may arise when a household owns several cars driven by different people and with different liabilities. In many cases, however, you can customize other forms of coverage (such as collision and comprehensive) for each car.
Type of Vehicles
Lastly, the multi-car discount only applies if you have the same type of vehicles on the same policy. For example, you can't insure a sedan, a motorcycle, and a motorboat on the same policy. Different types of automobiles face different risks; hence, they require separate policies.
The conditions may vary by company. To learn more, contact a company that provides personal auto insurance.
After we purchased our first home, we realized that it might be a good idea to evaluate our insurance coverage. Although we had purchased homeowners insurance before, we had never owned a policy as large as the one we would need for our new place. Also, our new home had a trampoline and a swimming pool, which made us worried about liability. To iron out the details, I decided to meet with our insurance agent. We talked about things like monthly premiums, coverage limits, and deductibles, and it was incredible to learn more about the terminology. This blog is designed to help you with the same types of questions.