Hardly a day goes by it seems, without another court challenge to the 1996 Defense of Marriage Act. Rulings have been made that same-sex couples who were married in a US state, the District of Columbia, a US territory or a foreign country should be afforded the same treatment as a heterosexual married couple, on the basis that not allowing equality was unconstitutional. Other courts have upheld bans on same-sex marriage. The rulings are routinely appealed.
On Monday in Indiana, for example, Governor Mike Pence issued a memo stating that marriages that took place in the three-day period when gay marriage was deemed legal should not be recognized by state agencies, while in Colorado a judge recently ruled that the state ban there should not be upheld.
While the judiciary works the issues through, it creates a confusing situation for the insurance industry. One day, same-sex couples may be legally married and the next day they’re not. A marriage in one state may or may not be recognized in another, possibly where they live.
Insurance agent David L. Kosar of Washington State says that although it is necessary to be aware of where same-sex marriage is legal and where it is not, the biggest issue surrounds couples who are not married but living together: “Both need to be listed on any insurance policy as named insureds in order to be properly covered. Rate class is also impacted by married vs. single. There is an internal struggle for agents/brokers who want to do the right thing and give the better rates, so the question becomes do you rate as married or not.”
Kosar says there is often a false belief that cover will be afforded when legally it is not, and says that it something brokers and agents should be careful to point out when policies are arranged. He also thinks this is something that the insurance companies need to take a lead on.
“Insurance companies need to do a better job of explaining to all same-sex and opposite-sex partners who are living together how their specific policy contract may or may not cover both parties in the event of a loss," he says. "It is a complicated issue and States have always differed on their insurance laws.”
While the issue of same-sex marriage is likely to cause confusion and frustration for some time to come, it’s clear that for brokers and agents that the best policy is using everyday good practice, knowing the law, advising well and ensuring that a couple’s needs are met.
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