If you're a nomad with no fixed roof over your head, you're an oddity in a society built on the assumption that everyone's got a permanent home.
These days we're living in RVs, travel trailers and boats. Some of us live in our cars. We live with friends and relatives, either doubled up more or less permanently or as couch surfers, crashing here and there for a time. Nearly one-third of Americans share a roof with people other than family, a spouse or a partner. The Census Bureau calls it "doubling up."
But despite their technologically sophisticated industry, auto insurance companies make an old-fashioned demand: You need a fixed address to get coverage.
"Insurance companies still have the idea that people have a permanent address, and a lot of people don't anymore," says Penny Gusner, CarInsurance.com's consumer analyst.
Where you sleep matters
There's logic behind the fixed-address requirement. Insurers base the prices for their auto insurance on how much risk they think they're taking to insure you. Many of their calculations about risk depend on your geographic location. (See “How your ZIP code affects your car insurance.”)
If you live in a neighborhood with a lot of vehicle theft, for example, selling you auto insurance appears riskier to the insurance company. To manage that risk, the company probably will charge you a higher price than it would if you lived an area with few auto thefts.
"They look at traffic patterns, fatalities in your area and everything else," says Gusner. "If you live in New York City or Los Angeles, the cost is going to be higher because you're in the middle of traffic, compared with where the roads are less full and you're in less risk of being in an accident."
Auto insurance for sofa surfers
That makes it more understandable. But what's a driver supposed to do for auto insurance without an address?
"I doubt anyone who is homeless would be looking for car insurance, even if they are living in their car," says Brian Sullivan, editor of Risk Information, which publishes newsletters about the insurance industry. "Insurance is the least of their problems."
Those who are sofa surfing face a different problem: They’re probably still driving to a job, or looking for one, but perhaps on car insurance that’s tied to their previous address. (And probably in search of ways to find cheaper coverage: See “Car insurance: Save the big money first.”)
Policies require the insured person to update the company with a change of address. Your insurance might provide coverage at the same rate, even under your new circumstances. But if you don’t update your address, a future claim could be denied, or the insurer may ask for additional premiums retroactive to your move.
So, when should you pick up the phone? There's no firm answer. Some companies ask for an updated address after 10 days, and others wait as long as 30 days. Company rules and state rules differ. That's why it's good to err on the side of caution.
If you're bunking at someone else's home, even for just a couple of weeks, you should tell your agent, Gusner says.
How would your insurance company know you’ve left your previous address? They might not. But if you’ve forwarded your mail, the insurance company’s “address correction requested” endorsement on its mail will automatically alert it to your new abode.
It’s all about who’s driving your car
Likewise, if you're the host and someone new has moved into your home, even for a short time, call your agent. Auto policy holders are also obliged to alert their insurers when new members are added to the household. The insurer wants to keep track of how many people of driving age are living there and who they are.
It sounds nosy, but the point is to be sure that any driver regularly using your car is included on your auto insurance policy. (The insurance industry estimates that $15.9 billion a year disappears off its books in unreported changes like these.)
Typically, you're covered by your policy if you loan your car just once or twice. "If your neighbor's car broke down and you let them use yours for a couple of days, that would be a 'permissive use,'" says Gusner, using the industry term for someone who's covered by your policy while borrowing your vehicle.
In fact, some companies go so far as to require you to alert them if someone who doesn't live with you has regular access to your car and will be driving it -- a boyfriend or girlfriend, for example.
"You really need to read the policy. When in doubt, call your agent and get clarification. That way you've done your due diligence in case there is a problem," Gusner adds.