Is Supplemental Spousal Liability Insurance Worth It?

Supplemental spousal liability insurance is a type of auto insurance coverage for unique circumstances within a married household. This coverage extends protection in scenarios where one spouse is injured due to the negligent driving of the other spouse. Understanding its function within an existing auto insurance policy is important. This article explores this coverage, its relevance, and factors to consider when evaluating its necessity.

Defining Supplemental Spousal Liability Insurance

Supplemental spousal liability insurance (SSLI) serves to protect a policyholder’s spouse from liability claims arising from the policyholder’s negligent driving. Standard auto liability coverage typically indemnifies the insured against claims from third parties, but often contains exclusions for claims made by family members, particularly spouses. This distinction originates from historical legal doctrines, like interspousal immunity, which prevented spouses from suing each other.

While interspousal immunity has largely been abolished in many jurisdictions, some insurance policies continued to include exclusions for interspousal claims, partly to prevent potential collusive lawsuits. Supplemental spousal liability insurance bridges this gap, allowing an injured spouse to seek compensation from their own auto insurance policy if the other spouse was at fault for an accident. This coverage operates within the existing bodily injury liability limits of the primary auto policy, rather than increasing those limits.

Situations Where Coverage is Relevant

Supplemental spousal liability insurance is relevant when one spouse’s negligence causes injury to the other. Consider a situation where the driver-spouse is at fault for a car accident, and the passenger-spouse sustains injuries. Without SSLI, the injured spouse might be unable to file a claim against the at-fault spouse’s liability coverage for damages such as medical expenses, lost wages, or pain and suffering.

For instance, if a spouse is driving and rear-ends another vehicle, causing the passenger-spouse to suffer injuries like a broken bone or whiplash, this coverage would allow the injured spouse to pursue a claim. Similarly, if a single-vehicle accident occurs, such as hitting a tree, and the driver-spouse is deemed negligent, the passenger-spouse could seek compensation. These are instances where standard liability insurance, designed for external third-party claims, typically would not provide coverage for the injured spouse.

Key Considerations for Evaluating Need

Evaluating the need for supplemental spousal liability insurance involves considering household circumstances and risk tolerance. A primary factor is simply the presence of a spouse, as this coverage is irrelevant for unmarried individuals. The frequency of spouses traveling together also influences the potential for such a scenario. Household financial considerations are also important; if one spouse were to suffer a severe injury, the costs of medical treatment, rehabilitation, and lost income could be substantial.

While health insurance may cover medical bills, it generally does not address other damages like pain and suffering or lost wages, which SSLI can help compensate. This coverage can act as a safeguard to protect family assets from the financial burden of serious injuries. Additionally, some individuals may weigh the emotional implications of one spouse needing to pursue a claim against the other, even if it is an insurance process.

Understanding Policy Features and Premiums

Supplemental spousal liability insurance is not a standalone product; it is added as an endorsement or rider to an existing auto insurance policy. In many jurisdictions, this coverage is now automatically included in policies unless the policyholder explicitly declines it in writing. This shift from an opt-in to an opt-out model aims to ensure broader protection for married individuals.

When reviewing policy terms, it is important to confirm that the coverage limits for SSLI align with the bodily injury liability limits of the main policy. Policyholders should also examine any specific exclusions that might limit the scope of coverage. The premium for supplemental spousal liability insurance is typically a modest additional charge, often ranging from approximately $15 to $84 annually. The exact cost can vary based on the overall auto insurance policy details, the specific insurer, and the chosen coverage limits.