The ‘widow’s penalty’ increases car insurance after death

Joe Kline of Suffield was shocked when he called his insurance agent after his wife of 52 years, Angie, died in April of pulmonary fibrosis.

Kline wanted to keep two cars insured, but thought his insurance would go down with one less driver.

In fact, it increased by approx $20 on half.

“That’s when I woke up,” Kline said. “I didn’t think it would be cut in half, but it shouldn’t go up.”

That didn’t work, Kline said, as he was now half-responsible for the insurance company. Kline said he knows it’s not a lot of money, but it’s a fact that angered him. They lost the discount for several drivers.

“So I guess they think that if you don’t have your spouse in the passenger seat anymore they’re telling you to stop following or slow down which makes you a good driver, right?” he said.

Kline drives for a living and has never been in an accident in 35 years. If he was a good driver the day before his wife died, why is he a good driver the day after she died, he said?

“Just give me a good reason and I’ll be happy to pay,” Kline said.

One state agrees with Kline.

Delaware they prohibit what their former insurance executive called the “widow’s penalty,” where a widow or widower was charged with additional liability after the death of a spouse.

In 2015, he was the Delaware Insurance Commissioner Karen Weldin Stewart announced that they would not accept car insurance coverage that included the penalty.

“The so-called ‘widow penalty’ is unjust,” the Commissioner said in a press release at the time. “Being a single driver due to the death of your spouse is not the same as being a young, inexperienced driver. I would not recommend any auto insurance quotes that do not provide you with clear information that includes widows and widowers at a higher rate. group.

“Car insurance companies are allowed to charge inexperienced drivers, such as teenagers, higher premiums because some studies show that young unmarried drivers pay more than young drivers. Delaware Department of Insurance “We are not aware of any evidence that older single drivers show the same behavior as older married drivers,” the Commissioner said.

The official went on to say that his department realized that being married is not the only reason money can change after losing a wife. Companies could discount many other things, or couples could be considered together when deciding the price.

“When a spouse dies, the premium will change to reflect the risk of the remaining driver. If the driver has a better driving record than his or her spouse, the premium may be lower.

Later the ban became a Delaware state laws when the current Delaware Insurance Commissioner Trinidad Navarro works with lawmakers, a spokeswoman for Navarro’s office told me in an email.

I checked with several sources government and national companies, and it is not known if other countries prohibit the act like Delaware. Many sources had never heard of the ban.

In Ohiothere is no such restriction, according to Ohio Department of Insurance.

Spokesman Robert Denhardt He said every problem is different and encourages consumers who have questions about their policies or any issues to contact the government agency.

“Each insurance is unique and different factors are involved, especially when the policy is recalculated, not penalized, based on the different risks of two people to know about one person,” said Denhard.

Users can call 800-686-1526 or email [email protected] it’s a story.

Shop around with any changes

Several industry sources, incl Scott HolemanMedia Relations Director at new York– fixed Insurance Information Institutehe said he had never heard of the “widow’s penalty,” but encouraged married couples to shop near death to get competitive prices.

“Because insurance is a very competitive business, Triple-I they encourage consumers to check prices regularly with at least three companies to see if they qualify for savings. In other words, we always recommend shopping around, “said Holeman. “In addition, consumers should keep an annual list to discuss any questions they have with their insurance experts every year, as needs change, especially during life transitions.”

Robert Passmorevice president to American Property Casualty Insurance AssociationHe also recommended calling your insurance company to find out why the price increase occurred or shopping around when you see the price increase.

“Insurance figures are subject to strict actuarial rules and government regulations, which ensure that all the disclosures accurately reflect the risk of loss,” he said.

But Passmore said auto insurers “have been collecting data for decades, and over the years they’ve found that things like marriage have proven to be very accurate predictors of the likelihood and risk of insurance.”

Passmore suggests looking at new things like “useful insurance, especially if you’re driving less, in addition, take steps to avoid accidents like driving while distracted.”

Kline ended up staying with the same insurance company, but her agent found another program to lower her premiums. Kline still thinks the practice is unfair, but said he was convinced by the company to stay. She wouldn’t have gotten the low-cost savings if she hadn’t pushed back, however, and encouraged other widows and widowers to look into savings.

Kline still says that the “widow’s penalty” or change when one person is removed from the plan is not understood.

“What’s the difference between death and divorce? This is something that affects a lot of people.”

Betty Lin-Fisher can be reached at 330-996-3724 or [email protected]. Follow him @blinfisherABJ on Twitter or www.facebook.com/BettyLinFisherABJ. To see his latest stories and episodes, go to www.tinyurl.com/bettylinfisher

Betty Lin-Fisher

Consumer Columnist

Akron Beacon Journal

USA TODAY NETWORK – OHIO