Global Privacy Signal Detected
Skip to main content

Do I Have to Insure All My Cars with the Same Company?

Do I Have To Insure All My Cars With the Same Company? 

While no legal statute requires drivers to insure all their vehicles with a single company, doing so can prevent a fair amount of headache and provide the following benefits:

  • Multi-car discounts
  • One combined monthly premium 
  • Streamlined claims process
  • Legal protections

However, people in the same household often must purchase different car insurance policies if:

  • They own a luxury vehicle that requires specialized insurance
  • They have an accident history that could negatively impact other residents’ insurance rates
  • They drive a company or commercial car
  • They recently underwent a divorce and registered their car at a new address

Understanding these discrepancies can help you structure an affordable insurance plan that aptly suits your family’s needs.

Why Is It Bad To Purchase Separate Policies? 

Purchasing multiple car insurance policies presents numerous disadvantages and redundancies.

Double Premiums 

Insuring multiple vehicles with different companies requires separate payment schedules, heightening your risk of invoking late penalties. For example, if one bill falls on the 1st of each month and the other occurs on the 10th, you may occasionally lose track of the second payment. By bundling policies, you would only pay a combined premium on a single monthly bill, minimizing the potential for error.

Furthermore, some carriers still require members to list household drivers of separate cars in both policies, jointly raising premium rates. Depending on other family members’ age and driving history, failing to combine your insurance premiums can more than double your monthly dues.

Difficult Claims Process 

Working with multiple auto insurance companies can significantly complicate the claims process. Dual claims can eat up time and even delay your payout if one insurance company attempts to recoup money from the other.

Even after one insurer admits financial responsibility, you would likely see both premiums increase after filing a claim. Likewise, you would probably lose your safe driver discount and no-claims bonus on both policies simultaneously.

No Access To Discounts 

Insuring two or more vehicles under a single policy usually results in a multi-car discount, lowering combined premiums by as much as 25%. To qualify, insurers typically require that each car share an address, a premium, and a payment date, proving especially useful for married couples, roommates, dependent teen drivers, and other individuals living in the same household.

Conversely, purchasing separate policies would negate your discount eligibility, as competing insurers rarely recognize outside coverage as compliant. Considering that national auto insurance premiums currently average $1,411 annually, missing out on these discounts could cost you hundreds of dollars extra to cover any other vehicle garaged at your residence.

Legal Issues 

While securing car insurance through multiple companies is not technically illegal, it puts policyholders at risk of insurance fraud. For example, if you get into a car accident and make duplicate claims with each insurer, a court could find you guilty of attempting to double your payout and impose heavy fines or imprisonment. 

Alternatively, forgetting to notify one of the two companies of your accident might lead them to drop coverage or refuse to defend you in a lawsuit. Likewise, some insurance companies do not allow secondary policies on a presently insured vehicle. If one insurance carrier hears of a complimentary plan through the DMV or your financing company, they can immediately cancel your benefits.

When Should You Consider Two Policies? 

Despite the many downsides of taking out multiple insurance policies, it occasionally makes sense for divorced couples, owners of expensive cars, and people who drive company vehicles.


In addition to the emotional toll of a divorce, recently separated couples undergo the complicated process of financial disentanglement. Once you have moved to a separate residence and a vehicle’s title reflects your sole ownership, most auto insurance companies will not allow you to continue bundling your insurance to take advantage of affiliated discounts. 

Even if you can continue sharing a policy with your former spouse, you may not have ended your relationship on the best terms. Recently divorced couples often forfeit potential savings opportunities in favor of separate policies, allowing them to avoid regular communication and move on with their lives.

Ownership of an Expensive Car 

Standard auto insurance companies can withhold coverage for luxury, exotic, or classic cars due to the high cost of parts and repairs or the lack of contemporary safety features like airbags and traction control. These vehicle owners must often purchase individualized protections from special companies, usually for much higher rates than a standard policy.

While you may not need to report accidents in your luxury vehicle to both insurers, marks on your driving record typically increases your risk level in the eyes of all insurance companies. The insurer of your non-luxury car would likely hear about any expensive claims from DMV or police reports and use that information to determine rates during your next policy renewal.

Work Vehicles 

People who drive company or commercial vehicles for work often must secure a specialized insurance policy. While standard coverage can apply to limited business use, such as work commutes or small deliveries, it will not cover accidents incurred while transporting goods, employees, or providing business-related services. Commercial insurers often withhold coverage from individuals driving commercial vehicles for recreational use.

Likewise, if you have explicitly purchased and driven a vehicle for business reasons, you can deduct the entire cost of ownership and operation from your taxes. These deductions can include gas, oil, repairs, registration fees, licenses, depreciation, and the total cost of your monthly insurance premiums.

How Much Can You Save With a Multi-Car Discount? 

Though rates ultimately depend on your vehicle and insurance company, covering two or more cars under one policy can save money in the following ways:

  • Reduced premiums: Bundling insurance policies together can reduce premiums by as much as 25% per additional vehicle.
  • Single claims deductibles: Some carriers offer a universal deductible for bundled policies, meaning that damaging multiple cars would not result in duplicate deductible fees.
  • Stacking coverage: Combining coverage limits for cars on the same policy increases your financial protection against severe accidents.
  • Tailored benefits: Bundled policies still allow members to customize coverage for each car based on its value, usage, and typical driver (such as a high-risk teen vs. a stay-at-home mother).

All in All 

Multi-vehicle policies typically qualify for significant discounts, offer a convenient means of filing claims, allow for one universal bill payment, and help members avoid insurance fraud. While most people benefit from bundled coverage, recently divorced couples, owners of luxury or classic cars, and commercial vehicle operators often must secure separate policies. 

Contact your insurance company with any questions surrounding your coverage options and potential discounts to maximize your savings and benefits potential. If your insurance company will not cover all your cars together, research and compare prices from at least three outside insurers to secure the best affordable coverage on a secondary policy.

Frequently Asked Questions

No. However, while there is no direct link between car insurance payments and credit score, failing to pay premiums on either auto insurance policy can trigger the services of a debt collections agency. Debt collection records remain on your credit report for 7-10 years and can negatively impact the cost of future insurance quotes.

It depends. While many auto insurance companies offer annual no-claims bonuses for maintaining a clean driving record, only some will honor discounts provided by a previous insurer or applied to a separate vehicle. Even if they allow it, your new insurance company can reduce the discount percentage or cap eligible savings after a specified amount of claims-free years.

Find an auto insurance policy that meets your needs.

Get a quote

Find an auto insurance policy that meets your needs.

Get a quote