Being Single In California Could Get Even Better (For Your Wallet, At Least)
It pays to be married. Married people get a break on their taxes, they get to split rent, and in most states, they pay less in car insurance. But one of those perks of marriage could be going away for Californians, so if you were intimidated by the financial implications of a divorce, there's one less barrier now. California Insurance Commissioner Ricardo Lara announced this week that he is barring auto insurers from considering marital status in setting premiums, citing "evolving societal norms."
Single, divorced, and widowed Californians have paid higher car insurance premiums for 30 years, and the insurance department has previously defended the regulation as valid, but according to The LA Times, "The [insurance] department said that while there is a correlation between marital status and accident rates, it said that correlation could be driven by secondary factors, such as income, educational attainment and employment." After October 25, the department will no longer allow marital status to be used for any rate plans, though Lara's regulatory change still has to go through a review to make sure it doesn't violate state law before it can take effect.
Some states alread have similar policies in place
11 unmarried drivers filed a lawsuit against the insurance department in 2022 seeking to overturn the policy that allows car insurance companies to charge single people more money than married people, a practice which the state appeals court upheld, but is being appealed to California's Supreme Court.
An attorney representing the drivers suing insurance companies for the practice of charging single drivers more for insurance told the LA Times that the decision is a brazen attempt to moot the lawsuit before it reaches the state Supreme Court.
In his announcement, Lara said, "Today, we are taking action to end that outdated practice and reinforce a simple principle: insurance rates should be grounded in actual driving risk, not personal circumstances that have nothing to do with how someone behaves behind the wheel."
The commonwealth of Massachusetts and the states of Michigan and Hawaii already bar insurers from using marital status as a factor in determining their rates. According to a study by the Consumer Federation of California, unmarried drivers pay about $200 more per year than married drivers do.