A Newlywed's Guide to Updating Insurance

Don’t wait too long after the honeymoon to dive into your finances as a married couple. Getting married is a “qualifying event”, giving you a rare 30-60 day window to change your insurance elections outside the annual enrollment period. Here is how to start reviewing your policies together for the first time as a couple.

Life Insurance

Ask yourself the difficult question – what would you do if something happened to your spouse? Would you stay in the same house? Same city?

Many people come to marriage without any life insurance because there isn’t yet anyone dependent on their income. For couples that don’t own a home together or have children, getting married alone may not require a life insurance purchase.

That being said, a risk that you need to be aware of is that you may have a medical event that prevents you from being able to obtain insurance in the future. For example, I have clients who had heart issues, a cancer diagnosis, and brain abnormalities discovered in their 30s and 40s - all impacting their ability to secure insurance. If you are uncomfortable with that risk, you may choose to obtain a policy now to lock in coverage even though you don’t necessarily need the policy yet.

For those actively shopping for a home together or trying to start a family, that strengthens the argument towards being proactive and purchasing a Term Life policy now versus delaying.

Disability Insurance

If you become disabled due to an injury or illness, will you be able to maintain your lifestyle? Disability insurance typically covers 50-70% of your monthly salary. Confirm you are both participating in your employer’s disability plan if there is one, or shop around for a private policy.

Health Insurance

Now that you are married, you can apply for joint coverage as a family under one of your health plans if that is beneficial. You may consider a plan with a Health Savings Account (HSA) if it is available and you have the cash flow to support the high deductible and annual HSA contributions.

Auto Insurance

Confirm your spouse is added as a second driver of your vehicle. Now is also a good time to confirm that you and your spouse have adequate liability and property damage coverage. I review the policies of newlyweds all the time and coverages rarely match. Many times, one has sufficient coverage and the other doesn’t. Let’s get you both on the same page with where you need to be.

Homeowners or Renters Insurance

If you are moving into one of your residences or getting a new place together, cancel the policy associated with the old residence. Make sure the new policy has enough "contents replacement" coverage for both of your personal belongings and has both your names listed as policy owners/insured.

Umbrella Insurance

Umbrella insurance is an additional layer of liability protection to supplement your home and auto policies. It also covers other risks such as libel and slander.

If your combined net worth is more than the liability limit on your home and auto insurance (typically $300K-$500K), you may consider purchasing an umbrella policy to protect your assets and future income potential.

Combining Policies Under One Provider

Combining your insurance coverage under one roof is usually the best way to keep costs low since most providers offer bundling discounts. This will also ensure that you don't have gaps in coverage and that your limits match. If you and your spouse have separate insurance companies, discuss which company you like best and obtain a quote to see your options.

originally published 2/7/2018

Linda Rogers, CFP®, EA, MSBA is the owner and founder of Planning Within Reach, LLC (PWR). Originally from New Jersey, Linda services clients throughout San Diego county and nationwide. She leads the design of PWR's investment portfolios which utilize broad, low-cost investments that integrate environmentally, socially, and governance (ESG) factors.

Planning Within Reach, LLC (PWR) is a fee-only and fiduciary wealth management firm offering one-time comprehensive financial planning, ongoing impact-focused investment management and tax preparation services in San Diego and nationwide. PWR is a woman-owned firm that specializes in busy professionals and impact investors. Planning Within Reach, LLC and their advisors do not receive commissions and do not hold any insurance licenses or brokerage relationships.