How falling in love can impact your insurance

Updated:
February 14, 2020

Valentine's Day is the most romantic day of the year and many couples find it the perfect day to get engaged! Should you be one of those lucky couples, there are a number of insurance-related topics to keep in mind before your wedding.

Car Insurance for Married Couples

Insurance companies in Ontario set their own criteria for determining car insurance rates. While not all insurance companies consider marital status a significant factor, marital status does play some role in this calculation.

It's not mandatory to include your spouse on your insurance policy but your insurer may not settle a claim if your spouse was driving your car.

Per the Ontario Automobile Policy, section 1.4.1, it is your responsibility to notify insurers of any change in marital status. "You also agree to let us know of any change that might increase the risk of an incident or affect our willingness to insure you at current rates."

When both spouses have clean driving records, combining car insurance policies will often drop your rates and the main reason for the drop is a multi-car discount. Further combining home insurance or renters insurance policies can provide additional rate decreases.

Home Insurance and Renters Insurance for Married Couples

When two lovebirds move in together, they combine their possessions in one dwelling. Therefore, making sure the contents limit of your homeowners insurance policy or tenants insurance policy will cover the combined contents replacement value is critical.

It's always a great idea to complete an inventory of all your possessions including wedding gifts. We also recommend you take photos of all the rooms in your home and at multiple angles. This will make the claims process much easier during a difficult time. You will be able to identify all of the lost/damaged items by the photos. You can upload your inventory and photos to cloud storage. You may also send them to us and we can store them on our server.

Consider Adding Guaranteed Replacement Cost

Policies often include "Actual Cash Value" of your possessions which means in the event of a claim, insurers will reimburse the value of your possessions less depreciation. For example, if you own a 10-year-old $5,000 TV, insurers will take into account the age of the TV.

However, if you include Guaranteed Replacement Cost, insurers will replace your contents at the price it would be to replace today! That $5,000 TV will be replaced with an equivalent TV in today's prices.

So, if you've recently gotten engaged or married, contact your insurance broker and we'll help you and your significant other decide what's right for you both.

FAQs

What is financial advising?

Financial advising involves providing guidance and advice to individuals, families, or businesses to help them make informed decisions about their financial matters. This can include various aspects such as investment planning, retirement planning, tax planning, estate planning, and more. Financial advisors analyze their clients' financial situations, goals, and risk tolerance to create customized strategies that align with their objectives.

Why is financial planning important?

Financial planning is crucial for several reasons:

Goal Achievement: It helps individuals set and achieve financial goals, whether they are short-term, such as buying a home, or long-term, like funding a comfortable retirement.

Risk Management: Financial planning addresses risks by considering insurance, emergency funds, and other protective measures.

Budgeting and Saving: It promotes responsible money management through budgeting and saving, fostering financial stability.

Wealth Building: Effective financial planning can lead to wealth accumulation and the creation of a secure financial future.

Can financial advisors help with debt?

Yes, financial advisors can help with debt management. They can assess your overall financial situation, create a budget, and develop strategies to pay down debt efficiently. They may also negotiate with creditors on your behalf, provide debt consolidation recommendations, and offer guidance on prioritizing and managing debt repayment.

What exactly does a financial advisor do?

The specific responsibilities of a financial advisor can vary, but generally, they:

  1. Conduct a thorough analysis of a client's financial situation, including income, expenses, assets, and liabilities.
  2. Develop personalized financial plans based on the client's goals, risk tolerance, and time horizon.
  3. Provide investment advice and portfolio management services.
  4. Offer guidance on retirement planning, estate planning, tax planning, and insurance.
  5. Monitor and adjust financial plans as needed based on changes in the client's life or market conditions.
  6. Educate clients on financial matters and empower them to make informed decisions.
What is the average fee for a financial advisor?

The fees charged by financial advisors can vary widely based on factors such as the advisor's experience, the services provided, and the region.

Common fee structures include:

Hourly Fees: Advisors charge an hourly rate for their services.
Flat or Fixed Fees: A set fee is charged for specific services or a comprehensive financial plan.
Asset-based Fees: Fees are a percentage of the assets under management (AUM).
Commission-based Fees: Advisors earn commissions on financial products they sell.
Combination of Fees: Advisors may use a combination of the above fee structures.
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It's important to discuss and clarify fee arrangements with a potential financial advisor before engaging in their services.