The refund letter from our insurer arrived on Monday, and it was smaller than I wanted it to be. That's my fault, and I'll explain why.
Josh started his job in Indianapolis in June. He bought a used 2019 sedan the week he moved, and for the first time in his life he has his own car insurance in his own name. Emily came off our policy years ago, back when she married Nate and they combined their policies. So as of this summer, our auto policy finally covers just the two vehicles we actually drive and the two people who drive them.
What came off our bill
Josh was listed on our policy as a driver of my 2017 SUV. Even though he only drove it on breaks and summers, a young male driver costs a lot to insure. When I called to remove him, the agent ran the numbers: our auto premium drops by about $410 a year, or a little over $34 a month.
That's not a fortune, but it's real money. Combined with dropping collision on Greg's truck last December, our auto policy is now noticeably cheaper than it was a year ago.
The paperwork
The process was simpler than I expected, but there were a few steps I didn't know about.
- Josh had to get his own policy in place first, with an effective date, before we removed him. You don't want a gap in his coverage history, because insurers look at continuous coverage when setting rates.
- Our agent asked for proof that Josh lives at a different address and has his own insurance. A copy of his new policy's declarations page was enough.
- Because Josh's car is titled and registered in Indiana and kept there, it couldn't have gone on our Ohio policy even if we'd wanted it to.
- The agent removed Josh as a listed driver and confirmed the new premium in writing.
- The insurer credited back the difference for the remaining months of our policy term.
Josh's own policy is about $1,480 a year at 22, which made him wince. I reminded him that he'd been riding on our discounts for years. Greg told him, "Welcome to adulthood," which I think he'd been saving up.
The timing I'd get right next time
Here's where I lost a little money. Josh's policy started the second week of June, the day he picked up his car. I didn't call our agent to take him off our policy until late July, after I noticed his name still on a billing statement. Our agent backdated the change a few weeks as a courtesy, but not all the way. Those extra weeks of paying for a son who lives in another state cost us about $50.
It's not a disaster. But I'm the person in this family who keeps the green notebook, and I still missed it. If I'd done it right, I would have:
Called our agent the same week Josh signed his lease, to ask exactly what they'd need and when. Set the removal date to match his new policy's start date, to the day. Asked in advance whether there's a fee for a mid-term change (there wasn't). And written the date on the calendar instead of telling myself I'd remember.
A few other things I learned
If your kids are away at school but still on your policy, ask about a student-away discount. Josh had that for a while when he was at UC without a car, and it saved us a little.
If a child moves out but still drives your car sometimes, talk to your agent about how they should be listed. It might cost less to keep them as an occasional driver than to risk a claim being denied.
And if your child is getting their own policy, have them shop it rather than just going with yours. Josh got three quotes and picked a different company from ours. I'm not going to name either one, and I'm not an insurance expert, but at 22 it's good practice to compare.
The house got quieter again this summer, and now the insurance bill did too. I'm still getting used to the first one. The second one I'll take.
