Every state creates its own insurance laws. A law that applies in Texas may bear no resemblance to those at work in Oregon. While most states do require your garaging address, we cannot speak for all. Your agent is the best place to be certain of accuracy.
When we begin a new auto insurance policy or add a car to the household, the writing agent will ask the vehicle’s garaging location where will be most of the time. Why does he or she care where you park your car at night? Isn’t that just a little bit nosy?
The address where your car lives determines to a large extent how much you will pay for the policy. Policy premiums are based on several factors related to location. Accidents that occur on high-speed freeways do more damage than those on quiet streets, resulting in higher repair costs or more frequent total losses. High-population areas tend to have more accidents per driver than rural areas. Even the best drivers are more likely to be involved in accidents on heavily travelled city streets than drivers in small towns where traffic is sparse. Greater risk raises expenses, which raises premiums.
Comprehensive coverages, which pay for losses such as vandalism, auto theft, or damage due to falling objects or more often occur more often in population centers. Again, greater risk equals higher premiums. Storm damage, on the other hand, may happen more frequently in rural areas, where flying branches or falling trees damage cars. Garaging location is very important in determining premiums in each area.
Costs of accidents are figured into the premium. Auto body repair costs may be greater in one area than another. Access to parts and adequate labor is better in cities. Much depends on costs associated with injury care. Surprisingly, death rates are greater in rural areas than in cities, possibly because of access to care and perhaps due to longer response time for on emergency personnel. Auto accident fatalities are expensive, often paying out policy maximums in liability settlements. Immediate and adequate care may prevent complications that increase the cost of accidents.
All factors affected by location are taken into consideration statistically when insurance companies calculate expected future losses and set premiums to make sure all claims may be paid in timely fashion and in full. In addition, insurance companies are required to show a profit in order to keep their investors.
Insurance companies want to know not only where you park your car, but what other drivers might live in the residence. If there are other residents, you may be asked to show proof that they are insured or to add such drivers to your policy. Additional drivers will be assessed according to their insurability, and the policy rated accordingly. If another driver has a very bad driving record, the company may be unable or unwilling to write the policy, on the assumption that if he resides in the household, he will sooner or later drive the insured car.
The insuring company may be on the hook for any lawsuits brought against the policy even if you promise the driver with the record is not allowed to drive the car. Many, many policies have paid damages for drivers who were not supposed to drive the insured vehicle.
Underwriting capabilities have improved over the years. Finding out if another driver shares your garaging address is often as easy as a few fingers tapping on a keyboard. Protect yourself from unnecessarily expensive premiums and claims you may have to pay by being honest with your insurance provider.
If the insurance company learns through a claim or publicly available information that you have a driver in the house who, for example, has a suspended driver license, you risk having the policy cancelled, which may hinder your ability to buy another policy at a reasonable price. It could conceivably result in a claim not being covered because you lied in your application. Be sure to keep your agent up to date on drivers who share your household.
If you park your vehicle at more than one residence, the one where your vehicle is parked the most time is your garaging location. For example, if you live in the suburbs but work in a city and stay there during the week, and don’t take your car, the suburb home is your garaging address. Be sure to keep your insurance company up to date as to where you may be reached. You will want to be advised if a payment fails to reach them, or if you need to know about some important change in your coverage or claim status. If you’re snow birding in Phoenix, and police recover your stolen car in California, you’ll want them to be up to date on contact information.