Getting married is a huge deal, and putting the “two shall become one” thing into practice can be a challenge—especially when it comes to combining your finances.
After all, sitting down to do monthly budgets and opening joint bank accounts together are all part of joining your lives! But guess what people usually forget in the middle of all that wedding planning and honeymooning? Insurance!
We know, you’ve got a lot going on as you prepare to spend the rest of your lives together. But it’s so important to do an insurance coverage checkup whenever you go through a major life event—and getting married is as major as it gets. Your lives are changing, and that means your insurance needs have changed too. If you’re not careful, you might not have the right insurance in place to protect your loved ones.
What Types of Insurance Do Married Couples Need?
There are four types of insurance for married couples that newlyweds (and couples generally) need to talk about and get in place once they say “I do”:
(By the way: you don’t necessarily need umbrella insurance yet. But if you already have a policy, you’ll need to update that, too. After all, more drivers and cars will always increase an umbrella policy’s premium.)
Here are some tips to help you get all the right insurance for married couples in place after you tie the knot.
Car Insurance
There’s a really good chance you might be able to get a discount on your car insurance—just for getting married!
While you might not magically become a better driver because you found your better half, statistics do show that married drivers file fewer claims and are less risky for insurance companies to insure. A recent report found that married drivers pay as much as 25% less for auto insurance than singles.1
This is also a great time to ask about other discounts. If you and your spouse each plan on bringing a car into the marriage, for example, you can have both cars covered under the same policy and maybe score a multicar discount in the process.
Tip: If you two lovebirds haven’t shopped insurance in a while, now’s the time. Once you get back from your honeymoon, get in touch with an independent insurance agent who can help make sure you and your spouse have the right amount of coverage—and the best deal—in place.
Homeowners or Renters Insurance
Now that you’re moving in together as husband and wife, chances are one of you needs to drop the renters or homeowners insurance policy you had while you were living on your own.
If you’re planning to rent during the first year or two of your marriage (that’s probably a good idea since you might need some time to figure out just how close you want to live to your in-laws!), then renters insurance is a must. Buy enough coverage to replace all your stuff in case of theft, fire or vandalism. Trust us, it’s worth the $15 to $20 per month, people!
What if you’re moving straight into a new home? Then you’ll need homeowners insurance. You’ll want to be sure you have enough insurance to cover the entire cost of replacing your house—and your stuff—if a tornado or a fire destroyed everything.
Also, keep in mind that some luxury items (wedding rings, anyone?) might not be fully covered under your homeowners or renters policy. If you’re worried about jewelry and other valuables, you could add a rider to your policy to fully insure them.
Do you have the right insurance coverage? You could be saving hundreds! Connect with an insurance pro today!
Tip: Now that we’ve talked about auto, homeowners and renters insurance, it’s a good time to talk about bundling your policies. You can probably save 15–20% each year on your insurance premiums just by bundling auto and homeowners insurance.
Life Insurance
Life insurance for married couples is an absolute must. Period. Life insurance should do one thing and one thing only: Replace your lost income if you die so your loved ones won’t suffer financial hardship after you’re gone. It’s not the kind of thing anyone wants to think about. But giving your spouse the peace of mind that life insurance offers is one of the most loving things you can do.
Each spouse should get a 15- or 20-year term life insurance policy with 10–12 times your annual income in coverage. So if you make $60,000 a year and your spouse brings home $50,000, you should get a policy worth at least $600,000 while your spouse takes out a policy worth no less than $500,000.
Stay-at-home parents need life insurance coverage too. How much exactly? First, add up the cost to replace all the jobs a stay-at-home parent does for a full year—things like childcare, cleaning and laundry services. Then, multiply that total by 10 or 12 to determine what you’ll need in coverage.
So, what happens once the term of the policy is up? Well, if you’ve been building wealth during those 15 or 20 years, consistently investing 15% of your income for retirement month after month and year after year, you probably won’t need life insurance anymore.
That’s because you’ll have enough money in savings and investments to be self-insured. Basically, that means becoming debt-free and positioning yourself so you could replace your annual income through the returns on your investments. Term life insurance bridges the gap while you’re building up that level of wealth.
Don’t put this off. Life insurance for married couples isn’t optional—it’s something you needed yesterday! Our friends at Zander Insurance can compare rates from some of the top term life insurance companies out there and help you find the best plan to protect your family.
Tip: What if you already have a life insurance policy in place? Get in touch with your insurance company or go online and update your beneficiaries ASAP. That way, your spouse would receive the death benefit if you suddenly died tomorrow. And if your existing policy isn’t term life, that needs changing too! First buy a term life policy, then cancel your old whole life policy when (and only when) your new policy is in force.
Got Kids? Use These 5 Tips to Get the Right Length of Life Insurance.
If you have kids depending on your income, you might be wondering, How long should my life insurance policy last? Great question!
Health Insurance
Most people have to wait until open enrollment to make any changes to their health coverage. But once you get married, you and your spouse can take advantage of a special enrollment period that allows both of you to figure out what you want to do with your health insurance.
You have two choices: Get on the same health care plan together or stick with the coverage you already have. Now, if each of you has health insurance through work and you’re happy with that coverage and how much it costs, then it’s probably best to keep your health insurance plans separate for now.
On the other hand, if one of you is a freelancer or stay-at-home parent who doesn’t have access to an employer-based health plan, it might be cheaper to get covered under the same plan instead of going with an individual plan from the health care marketplace.
You don’t have a lot of time to choose, though. Normally you have up to 60 days after getting married to enroll in a new individual health plan, or as few as 30 days to join your spouse’s employer-based health insurance.2 So get on that!
Here's A Tip
How do you decide on the right insurance plan? If you and your spouse are relatively healthy, you might want to consider a high-deductible health plan (HDHP) to save on premiums. Those plans usually come with a health savings account (HSA) you can fund and use to help cover deductibles and any out-of-pocket costs. Plus, they come with some great tax advantages, including tax-free withdrawals for medical expenses.
Work With an Independent Insurance Agent
We know suggesting an “insurance-shopping date night” isn’t exactly a one-way ticket to romance, so why don’t you let someone else do the work for you?
Our RamseyTrusted® insurance pros can shop around for the best deals on insurance based on your family’s needs. That’s because they’re independent insurance agents, which means they’re not trying to sell you coverage from just one insurance company. And the best part? Connecting with a pro is completely free!
Did you find this article helpful? Share it!
About the author
Ramsey Solutions