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Pending law: Car insurance for military will remain the same after out-of-state move

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CarInsurance.com

Military family movingCongress is weighing a bipartisan bill that would let military members and their families keep their current car insurance when ordered to move to another state.

The Servicemembers Insurance Relief Act (H.R. 4669) was introduced this week by U.S. Rep. Ed Royce (R-Calif.), a member of the House Financial Services Committee, and U.S. Rep. Tammy Duckworth (D-Ill.), an Iraq war veteran who also serves on the House Armed Services Committee.

The legislation, which is expected to be referred to the House Financial Services Committee, would make the state-based insurance regulatory system more responsive to military personnel who have to change policies every time they relocate across state lines, whether on temporary or more permanent duty. The bill also applies to the National Guard and Reserve. State car insurance rates vary, as do state insurance laws, so the bill aims to streamline the process for service members

"This bipartisan legislation makes a simple but meaningful change to current law that will lessen the burden on service members and their families during times of transition," Rep. Royce said in a written statement urging the bill's quick approval.

Specifically, insurance companies who are notified of soldiers' pending move must tell them they can keep their existing policy or seek new coverage if the rates are lower where they've now been posted.

USAA, which sells insurance to service men and women, said it supports the legislation. USAA also noted that the bill does give insurers the right to raise the premiums of the existing policy if the new location has higher underwriting risks, such as the odds that the vehicle could be stolen or damaged by hail or other natural events.

Roger Wildermuth, a USAA spokesman, says current USAA policyholders must now cancel their old policy and buy a new one after moving to another state, with increased or reduced rates reflecting the new location. "We try to make it as easy as possible when they get stationed elsewhere, but this bill would obviously make the whole process even easier," he added. "There would clearly be less paperwork and the like."

Car insurance rates at major military bases

Regardless of H.R. 4669, coverage costs will go up or down based on where a soldier is sent, as location plays a role in how car insurance rates are set. We checked to see what a 40-year-old male with a clean driving record would pay at various bases for the year, using CarInsurance.com's tool that shows average rates by ZIP code:

                ZIP

           Base

Rate

48092

           Detroit Arsenal (Army)

$ 2,448

33039

           Homestead Air Reserve Base, FL

$ 2,184

71110

           Barksdale Air Force Base, LA

$ 1,980

92055

           Camp Pendleton,CA

$ 1,466

19902

           Dover Air Force Base,DE

$ 1,450

20762

           Andrews Air Force Base,MD

$ 1,440

42223

           Fort Campbell,KY

$ 1,326

98438

           Joint Base Lewis-McChord, WA

$ 1,287

79607

           Dyess Air Force Base,TX

$ 1,259

28307

           Fort Bragg,NC

$ 1,165

97117

           Kirtland Air Force Base,NM

$ 1,162

32542

           Eglin Air Force Base,FL

$ 1,098

58204

           Grand Forks Air Force Base,ND

$ 1,003

13602

            Fort Drum,NY

$ 985

01731

            Hanscom Air Force Base,MA

$ 891

85614

            Fort Huachuca,AZ

$ 747

Until the bill is voted into law, military personnel will still have to buy new insurance policies in their new state where they are stationed. They will also still have to register their cars in the new location. Service members should also ask their insurer if it offers any military discounts. Some do, some don't.

USAA, for instance, offers a discount on comprehensive coverage if you live on base, which is considered a more secure environment, according to Angela Preciado, director of the auto product management team at USAA.

What about a temporary assignment? If you plan to return to your state of legal residence after a brief stay on a new base, Preciado says most states let you keep your old insurance, as well as your home state registration and license.

Not military but still moving? Car insurance and moving out-of-state

Penny Gusner, consumer analyst for Insure.com, offers a few auto insurance suggestions for anyone who moves from one state to another:

Know your needs. Find out about your new state's minimum requirements because liability limits and other necessary coverage vary by state. For example, your old state may not have required personal injury protection (PIP) but your new state is a no-fault state and does. Once you know, decide if you want to buy more protection, such as higher liability limits, collision and comprehensive coverage.

Take time to shop around. States typically give you 20 to 30 days after moving to register a vehicle. The insurer from your previous state usually gives you the same time before switching to a new policy, so use the grace period to compare rates and coverage. And, as pointed out earlier, your rates could be higher or lower depending on the risks associated with the new location.

Establish your new policy. Don't let too much time slip by when buying your insurance and registering the car in the new state.

Cancel your old policy. Don't drop it before registering your vehicle and having your new policy in place. Your former state will want you to return the license plates, and if you cancel your policy before then you may be penalized for being uninsured, even after moving.


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