Insurance Coverage for Unmarried Partners Living Together
Here's an overview of issues regarding life, automobile, and homeowners' insurance coverage for unmarried couples who live together.
Generally speaking, unmarried couples can purchase most types of insurance at competitive rates. This is usually easy to do, especially if you co-own property. Be sure to shop around, because prices can vary dramatically.
This article won’t help you decide whether or not you need a particular type of insurance, but will help you sort out some of the issues involved when buying insurance with a partner.
Many people get life insurance as a benefit of employment or buy their own insurance policy. Either way, you can name your partner as beneficiary. But Don’t claim to be married if you aren’t. If you have a life insurance policy in which you’ve incorrectly stated that you are married, change it. See the estate planning articles in this section for related issues on life insurance.
Homeowners’ (or hazard) insurance is sold to homeowners when they buy a house. It insures the house against fire, flood, and other acts of destruction. It used to be difficult for unmarried couples to buy homeowners’ insurance together, but this is no longer true. Many companies now write policies for unmarried couples at the same rates offered to married couples.
However, if you’re the sole owner of the house, your partner’s belongings won’t be automatically covered by your policy. If your partner has valuable personal property, check with your homeowners’ insurance company to see whether he or she can be added as an occupant and covered under the same terms as you are. Otherwise, your partner should purchase a separate renters’ insurance policy.
Renters’ insurance protects tenants against the loss of their property due to theft or some act of destruction. Like homeowners’ insurance, renters’ insurance is easy for an unmarried couple to obtain together. Insurance companies insure the property, not the owners of the property. And the rates are related to the age and security of your building, the neighborhood you live in, and how well your landlord maintains the building. Shop around. You should be able to find one policy that covers both of you, although a few companies may try to charge you more or require that you each buy your own policy.
Purchasing automobile insurance can be a problem for unmarried couples, but not to the extent it once was. If you each own a car, you should have no trouble getting separate insurance. For unmarried couples who jointly own one vehicle, obtaining one policy will be cheaper than getting two (one for each partner). But you may have to shop around to find an agent and company that will allow you to do this.
If you jointly own two or more cars, it’s often cheaper to get one policy covering all your cars. Married couples are always allowed to do this—and thereby get discounts and other special benefits. But again, not all insurance agents or companies will offer these benefits to unmarried couples. Shop around.
If all else fails, consider transferring ownership of both cars to one person (call your department of motor vehicles and ask how you can change the title slip) and listing the other person as a secondary driver.
Unmarried couples often cannot get employer-paid health insurance coverage for their partner. This is changing, however. Some cities and states are offering domestic partner benefits to their employees, and more and more private employers are doing the same. A majority of the country’s largest corporations offer domestic partner benefits. You can find a list of Fortune 500 companies that provide domestic partner benefits, as well as other information on benefits, at the Human Rights Campaign website. (Check "Workplace" under the "Issues" section on the site.)
If your employer doesn’t provide domestic partner health benefits, and your partner doesn’t get benefits through a job (or doesn’t work), see whether your employer will agree to cover your partner on its health plan if you pay for the premiums. Group plans available through employment are usually less expensive, and often provide better coverage, than individual plans.
Even if your employer does provide domestic partner health benefits, the premium paid to cover the domestic partner will be considered taxable income, not a pre-tax deduction from income as it is when the employee is covering a spouse. Also, be aware that the federal COBRA (Consolidated Omnibus Budget Reconciliation Act) health insurance rules don’t apply to your partner if you lose or leave your job. Under COBRA, your employer must allow you to continue health insurance coverage for a certain period of time, as long as you pay the premiums, but your partner is not entitled to continue domestic partner benefits as would be the case if you were married.
In some states, the dependent of a worker who is killed on the job can obtain death benefits from the state workers’ compensation insurance program. Because “dependent” is often broadly defined, in several instances courts have allowed unmarried partners to recover these benefits. For example, a Maryland court awarded workers’ compensation benefits to a woman who lived with the deceased worker for a number of years—giving up her job to take care of the house and raise the children while the deceased provided financial support. (Kendall v. Housing Auth., 76 A.2d 767 (Md. Ct. Spec. App. 1950).) In California, a court awarded benefits to a woman who lived with the deceased worker because she was a “good faith” member of his household, even though she was married to someone else. (State v. Workers’ Compensation Appeals Bd, 94 Cal. App. 3d 72 (Ct. App. 1979).) And in Oregon, the Workers’ Compensation statute itself states that unmarried cohabitants are entitled to compensation as long as the couple had children together and lived together for more than one year before the worker was injured. (Or. Rev. Stat. § 656.226 (1991).)
However, not all courts have been so generous. In South Carolina, a woman living with and dependent on a deceased worker was denied workers’ compensation benefits because she was married to another man. (Palm v. General Painting Co., 370 S.E. 2d 463 (S.C. Ct. App. 1988).) And in Nevada, a court denied death benefits to the unmarried cohabitant of a deceased worker, even where the cohabitant had previously been married to the deceased worker, because she no longer had a “legally recognizable relationship” with him. (Banegas v. State Indus. Ins. System, 19 P.3d 245 (2001).)
In many states, an employee may obtain unemployment insurance benefits for quitting a job for “good cause.” Often, the unemployment board will consider a spouse’s decision to leave employment in order to accompany the other spouse to a new home to be “good cause.” In several cases, this benefit has been extended to unmarried partners as well. For example, the Massachusetts Supreme Court ruled that a woman who left her job in order to remain with her living together partner of 13 years who was relocating his business had compelling reasons to quit and was entitled to unemployment insurance benefits. (Reep v. Commissioner of Dep’t of Employment & Training, 593 N.E. 2d 1297 (Mass. 1992).) The California Supreme Court also awarded unemployment benefits to an unmarried woman who quit her job in order to follow her partner to another state. (MacGregor v. Unemployment Ins. Appeals Bd., 37 Cal. 3d 205 (1984).) However, in that case, the court’s decision was based in large part on the fact that the unmarried couple had a child together. It’s unclear whether the California Supreme Court would rule the same way if an unmarried couple did not have children together.