Two car insurance, also known as multi car insurance is the same thing as a single car insurance, but it covers two or more cars. Basically, the perks are having two car insurance are two fold:
- The discount you get from having two or more cars on one insurance policy
and
- All the hassle you avoid by keeping all your vehicles on one insurance policy
The discount you get from having multiple vehicles on one policy comes from the fact that you’re sort of buying insurance in bulk. As previous stated in the fleet car insurance article, all your renewal dates are on the same date if you’re buying two car insurance, so you don’t have to mark on your calendar the days when you have to renew your auto insurance.
Same goes for the insurance company – when they have two cars on one policy instead of two cars on two separate policies – the bookkeeping costs and administration costs go down, and that’s partially why you’re getting a discount if you have two or more cars insured on one policy.
Just as the car insurance companies can afford to pay agents to sell insurance for them, they can also give you a discount on your premiums once you bring in an additional car to your policy, meaning that the insurance company saved money on marketing or advertising to acquire the new customer.
An example of getting insurance discount would be this: say, you’ve got a 2005 Nissan Maxima on your policy and you’re paying for liability*, collision** and comprehensive*** coverage. That costs you $573 per year in annual payments. Now, you put your wife on your policy and she only has to pay $498 for annual premiums.
And this is where the “No Claims” bonus comes into play. You need to carefully check who on your policy is earning this bonus and if you’re earning it separately or together. So in case you’re earning the “No Claims” bonus together and one the people on the insurance gets into an accident and files a claim – the bonus would be gone. If you had it set separate then only the person who has filed a claim would be left with no claims bonus but not the whole group.
* Liability coverage is the Bodily Injury and Property Damage Liability coverage involves cases in which another person is hurt or dies as a result of an auto accident. If you are legally responsible it’ll compensate the other party for pain, suffering or other hardships, and will also pay for some economic damages like lost wages and the cost of funeral. Property coverage will replace any damage that you’ve caused to others belongings as a result of an auto accident up to your property damage liability limit, if you have a split limits liability coverage.
** Collision insurance protects you from the damage you (or someone else) caused to your automobile. For example, you could file a collision insurance claim with your car insurance company instead of making a property damage liability claim against the insurer of the driver who caused the accident.
***Comprehensive (also known as “Other than collision”) coverage protects you if your car is jacked, along with damage caused to your vehicle caused by things like vandalism, fire, hail, earthquake, etc.