Can you have two auto insurance policies?
Can you have two auto insurance policies on one vehicle? You can, but it’s not recommended and will cost you more money. One company will not insure the same vehicle twice, and only one insurer will pay in the event of an auto claim. Filing two claims for a single accident is insurance fraud and could result in large fines or jail time. Don’t take the risk. Instead, research the level of coverage you require, compare rates from multiple companies, and choose one policy that meets all of your needs. Find auto insurance quotes now so you know you're with the best auto insurance company for you.
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UPDATED: Oct 26, 2020
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- It is not illegal to take out two insurance policies on the same car, however, insurance companies generally discourage the practice of double insuring a vehicle.
- Making two claims with two different insurance companies for the same accident may be considered insurance fraud.
- If you purchase two auto insurance policies for two different cars, you’ll miss out on multi-vehicle discounts and other opportunities for savings.
Almost everyone knows that you have to have auto insurance in order to legally drive a car. If you are caught driving without insurance, you could face heavy fines, court costs, and even jail time. But can you have two auto insurance policies at the same time for even more protection?
While there is no law against having two policies on a single vehicle, most companies discourage this practice. Making two claims with two different insurance companies for a single accident may be considered insurance fraud.
Read through our guide to better understand the legalities of having a vehicle insured twice. Oftentimes, two policies on a single car is both unnecessary and a nuisance, as it leads to confusion if the vehicle is involved in an accident.
To simplify things, you may want to use a comparison tool to find an auto insurance policy that adequately covers you and any other drivers who regularly drive the vehicle.
See how much a fuller coverage policy will cost you by entering your ZIP code into our FREE online quote tool above for affordable auto insurance rates now.
Can you legally have two auto insurance policies on one car?
A common question we hear is, “Can I have auto insurance from two different companies on one vehicle?” Drivers incorrectly assume that doubling up on policies is the only way to get better coverage.
However, what those drivers do not realize is that you can add extra coverage to a single policy instead of paying for a second one.
So perhaps the right question to ask is not, can you be on two auto insurance policies at once, but instead is, should you?
Can you have two car insurance policies in your name? While it is legal to have two auto insurance policies on the same vehicle, one insurance company will not insure the same car twice. You will have to purchase a second insurance policy with a different insurance carrier and pay both bills.
But if you choose to double-insure your car, you may be violating the policies of one or both insurance carriers. Your coverage could be terminated, leaving you entirely without insurance. Ultimately, you would’ve been better off paying for only one policy.
Paying for two separate policies will be twice as expensive. See the average annual cost for a single auto insurance policy in your state in the table below.
|State||Average Annual Auto Insurance Rates|
|District of Columbia||$1,330.73|
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If you plan on taking out two policies, double the number to approximate how much your two auto insurance policies might cost you. Even in states with lower than average auto insurance rates, paying for two policies is very pricey.
You might be thinking that two policies mean twice the payout if you ever need to file a claim. However, you will only be able to file one claim per accident.
When you register your vehicle or when the DMV is notified of your insurance policy, both of your insurance companies might be alerted about your dual policies, which could cause you problems.
Your coverage might be terminated by both providers, leaving you without insurance.
Two Auto Insurance Policies on One Car and Unjust Enrichment
Can you have two car insurance policies overlapping? This is where you need to be careful.
So, is it illegal to have two auto insurance policies on one car? Technically, you are not breaking any laws just by having two separate policies. However, what you do with those two policies can be problematic.
In the insurance world, if you get into a car accident and file claims with two different insurance companies in an attempt to give yourself a financial windfall, it is known as unjust enrichment. Unjust enrichment is a form of auto insurance fraud.
According to the National Association of Insurance Commissioners, fraud impacts auto insurance more than any other type of insurance. Otherwise called double-dipping, this is the primary reason most states and insurance companies disapprove of multiple auto insurance policies on one car.
Think about it. If both of your auto insurance claims were approved, you would get twice as much money for the accident then you would normally receive. You cannot keep both settlements.
The following video shows a few more common examples of auto insurance fraud the companies and the state lookout for.
The FBI reports that the total annual cost of insurance fraud, minus health insurance, is $40 billion. Not only is double-dipping a claim absolutely illegal and constitutes insurance fraud, but you may even be charged with a felony.
You’re better off purchasing a fuller coverage insurance policy that will legally protect your vehicle in the event of an accident.
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Reasons Drivers Consider Two Auto Insurance Policies
Can one car have two insurance policies? Yes, there are several reasons drivers use when they insure the same car with two different insurance companies. But as you’ve learned, in most cases a single policy will suffice, and a second policy is just a waste of money.
For example, perhaps you want to make sure you have adequate coverage in the event of an accident. Instead of taking out a second auto insurance policy and facing potential fraud charges, invest in more coverage options.
What does fully comprehensive auto insurance cover? The details of a full coverage policy will vary by company, however, it almost always includes your state’s minimum required level of coverage, as well as some level of collision and comprehensive insurance.
You can also add optional coverages, like roadside assistance programs, and even rental car assistance.
Or, maybe you share a vehicle with a roommate or friend and you both want different coverage levels on the vehicle. However, a second policy is still inadvisable. Paying for two separate policies will cost more than splitting a fuller coverage policy between two people.
If the roommate you share your vehicle with is a high-risk driver who struggles to receive affordable insurance rates, compare premiums from multiple different companies to find a policy that you can both afford.
You can use an auto insurance comparison tool, which will allow you to input the information for all of the drivers for the vehicle and the vehicle’s information. The tool will then compare your information and auto insurance desires with all of the available policies.
Ultimately, you and your roommate are better off coming to an agreement and splitting the costs for a single policy.
As you can see, in most instances having two auto insurance policies on a single vehicle is not a smart investment. Instead, explore the options available to you with a single auto insurance policy.
Two Auto Insurance Policies on Two Different Cars
You may now be wondering, can you have two separate car insurance policies on two different cars? If you own more than one vehicle, you can purchase two separate auto insurance policies to cover each car separately, however, you will be losing auto insurance discounts that can lead to massive savings.
If you insure both vehicles under one single policy, you will receive a multi-car policy discount. Because you’re giving the insurer more business, you’ll receive cheaper rates as a reward.
Sometimes, two cars have two separate policies because one is used for personal reasons, and the other is used for work. However, you can bundle commercial auto insurance policies and personal auto insurance policies with the same company for more opportunities for savings.
Can you have two car insurance policies in the same household? You are now an expert on how best to insure two vehicles. Don’t make the mistake of wasting money and time by taking out two policies on a single vehicle.
Avoid paying double by doing your research, establishing what level of coverage you need, and comparing rates from multiple companies so you know the policy you pay for is exactly what you want.
So, can you have two different or separate car insurance policies? You should now know the answer to this. If you have any questions or additional insight, feel free to leave a comment below.
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