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My 72 year old Father passed away earlier this year. Because the vehicles they owned were re-titled to reflect my Mother as the sole owner, the insurance carrier increased the premium they are now charging. I have not yet seen the actual notice, but Mom said they were citing something about a change in credit score as it relates to her as a single person vs. them as a married couple. BOTH of my parents have stellar credit…retirees, no mortgage, no credit balances, no late payments, everything paid in full on time, EVERY time.

Same home, same autos garaged in same location. Neither parent has had any claims, tickets, accidents, or anything that should stand out as a mitigating factor of increased risk. Now, there’s only one driver for both cars…she’s only going to be able to have one out at a time now.

I’ve been seeking information online as to why this could possibly be, but the best I can find is poorly written garbage which seems to lump the issue of spousal death together with divorce and does way more to explain the divorce situation than death.

I’m feeling like the insurance company is simply doing what they do in using any available excuse to try and raise rates. I am wondering if you think it is worth shopping her insurance around, or if she’ll simply come up against the same b.s. being dealt by this carrier.

Thanks in advance for taking the time with my question…I really appreciate it!

Jon

5 Thoughts on Why would spousal death negatively affect insurance premiums on home & autos?
  1. Reply
    mbrcatz
    December 12, 2011 at 5:32 am

    Yep, credit score could definately do it – if mom’s credit score is lower than dads.

    Clearly, if that’s what they are telling you, mom no longer has stellar credit. She needs to pull a copy of her credit report and see what’s going on. Keep in mind, it’s horrible, but it’s also COMMON for people who have obituaries published, to get their identity stolen. So she probably should pull a copy of dad’s credit report, also.

    One other thought – age rating. MOST insurance companies will NOT give decent rates to a driver 70 or older. Heck, most of my standard companies will YELL at me if I submit an application with a driver 70 or older. If the policy had to be rewritten to a new policy, in mom’s name, and she’s 70 or older, she could be with high risk rates.

    That’s one reason why insurance policies should list BOTH spouses as named insured – mom could keep the same policy, and just delete dad’s name, instead of having to rewrite the policy – and requalify for rates.

  2. Reply
    Jay
    December 12, 2011 at 6:01 am

    Shop around to see if your ins co is still worth keeping

  3. Reply
    StephenWeinstein
    December 12, 2011 at 6:59 am

    Married drivers have much lower accidents rates than unmarried drivers. A person who has no spouse, for whatever reason, is much more likely to crash than a person with a spouse.

    However, the bigger concern is how you know what their credit is. If you checked their credit yourself, then that answers the question, because checking someone else’s credit is illegal and puts them at increased risk of identity theft. Actually, that has nothing to do with their car insurance, but I thought I would mention it anyway.

    It is extremely unusually for anyone to know how good or bad there credit is, especially if they are retired. The first step here should be to have your mother, not you, check her credit report.

    The real issue though is financial. The main cause of insurance claims is not inability to drive. It is financial need. A person who has a perfect driving record but needs money cost an insurance company more money than a person with a lousy driving record but no financial issues.

    With your father alive, your parents were able to pay all their bills. The insurance company knew this, so the rates were low.

    With your father dead, your mother could (hypothetically) have difficulty paying her bills, so the cost of insurance is more.

  4. Reply
    car253
    December 12, 2011 at 7:40 am

    Call the Department of Insurance in your state for help. It may also be called the “Insurance Commissioner”.

    Some states use credit scores and some don’t. California doesn’t. I don’t feel it is fair. Tell your Department of Insurance not to use credit scores.

  5. Reply
    Tom Z
    December 12, 2011 at 7:45 am

    Have your mother ask the agent for quotes on both her home and auto insurance with another company. If he or she is unable to offer quotes from another company have her call another agent.

    Companies develop their own insurance scores and their own ideas of who is a preferred insured. She needs to find a company that offers better rates for seniors.

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