Here in Oakland County, Michigan, people going through a divorce usually focus on big issues like child custody, dividing assets, or who gets the house. Frankly, those are the issues that we divorce attorneys usually look at first. An issue less focused on but still important is car insurance. More often than not, auto insurance is deeply intertwined with marital status, living arrangements, and vehicle ownership. Understanding how to manage your car insurance policy is essential for protecting yourself financially and legally.
1. You Can’t Remove a Spouse Without Their Consent
Michigan insurance providers require both spouses’ consent before one can be removed from an auto insurance policy. This rule exists to prevent one spouse from being dropped from coverage without their knowledge, something that could expose them to serious liability. There are other significant issues related to the car insurance which include the name(s) on the vehicle title and and liens on the title.
Divorcing couples in Oakland County should work through their family law attorneys to come to a mutual agreement about the timing and terms of splitting auto coverage. Failure to do that could result in huge financial consequences.
2. Notify the Insurance Company After the Divorce Is Final
While Michigan law doesn’t mandate that you notify your car insurance provider of your divorce, most companies need to be notified within 30 days after your divorce judgment is entered. Failing to do so could lead to complications if a claim is filed or if one spouse is still listed on the other’s policy after separation. As an aside, all of your insurers should be notified right after your divorce is final. That includes medical insurance, home insurance, life insurance, disability insurance, and any other kind of insurance that you might have.
If you’re unsure what your specific policy requires, it’s best to call your insurer and your insurance agent directly. Don’t assume your divorce decree automatically updates your coverage.
3. Changing Addresses Separates Liability
As spouses begin to live separately during the divorce process, it’s crucial to update your mailing address and vehicle registration. Michigan insurers generally link liability to household members and their access to insured vehicles.
Once you’ve moved out of the marital residence, notify the insurance provider to reflect your new address and consider separating policies. This will reduce confusion and potential liability if an insurance claim arises involving either spouse.
4. Ownership Matters for Insurance Coverage
Under Michigan law, the named insured must generally be the vehicle’s legal owner. If you’re insuring a car, make sure your name is on the vehicle title. If both spouses are co-owners, the spouse not listed as the primary insured needs to be added as an “additional insured,” especially if they no longer reside at the same address. Check with your insurance agent and your attorney to be sure everything aligns and is in order.
For simplicity, each spouse should retain one vehicle in their name, with corresponding ownership documents and a separate auto policy. Each spouse needs to be named as an additional insured on the other spouse’s vehicle. Remember to also talk to your insurance agent about any minor children or children residing in the home.
5. Bundled Policies Will Need to Be Split
If you and your spouse had bundled auto and homeowner’s insurance, it’s common for the spouse keeping the marital home in Oakland County (whether in Novi or West Bloomfield) to also keep the existing policy. The other spouse will need to secure new auto insurance coverage, either with the same company or a new provider.
Plan ahead for this transition, and avoid making any major insurance changes until after the court issues your final Judgment of Divorce.
6. Don’t Change Policies Prematurely
Divorce agreements in Michigan can shift dramatically in the final weeks of negotiation. For this reason, it’s generally best to wait until the divorce is finalized before splitting or canceling shared auto insurance policies. Discuss all changes with your insurance agent and your family law attorney.
If changes are made too early, and the final terms are different from what was anticipated, you will have to redo your insurance arrangements, creating additional confusion and cost.
Final Thoughts: Take Auto Insurance Seriously During And After Your Divorce
Divorce is already a complex and emotionally draining process. But overlooking key details, like auto insurance coverage, can create additional legal and financial headaches. If you’re getting divorced in Michigan, here in Oakland County, or in Livingston County or Macomb County, make sure car insurance is part of your overall divorce planning strategy.
If you need guidance on divorce-related issues, including property division, vehicle ownership, or spousal support, the experienced family law attorneys at The Kronzek Firm are here to help. We serve clients throughout Oakland County, including Pontiac, Southfield, Berkley, and Royal Oak, and are well-versed in both divorce litigation and collaborative divorce processes. We’ve helped thousands of clients for more than 30 years. You can email us at contactus@kronzek.law or phone our Farmington Hills office at 248 479-6200.