Insurance is designed to financially protect you in case of an unlikely event, such as a car accident or damage to your home. But it can sometimes be hard to justify paying for insurance when you don’t know if you’ll ever need it.
For example, the 2020 Your Driving Costs study by AAA found the average annual cost of full-coverage car insurance was $1,202. Add in other policies, such as home or life insurance, and you’re likely looking at a higher total yearly expense.
Fortunately, many insurance providers offer options to bundle and save when you purchase different insurance policies from them. In this guide, you’ll learn how insurance bundling works and what benefits to look for in a home and car insurance bundle. This will help you learn how to compare rates and end up with the best car insurance as well as other insurance policies.
What is insurance bundling?
Major insurance providers like Allstate, Geico, and Progressive offer various types of insurance, which may include car insurance, home insurance, or life insurance. This makes it easy to shop around and get the best rates on insurance by comparing competing companies. For example, you might be able to get the best deal on an auto policy from one company and a great deal on homeowners insurance from another.
This strategy for saving money on insurance policies might make sense in some situations. But most major insurance providers also offer multi-policy discounts, which incentivize customers to stick with one insurance company when purchasing multiple insurance products.
A multi-policy discount typically offers a discount on your insurance payments (premiums) if you purchase two or more policies through the same company. So if you buy a home and car insurance bundle, you might expect savings of 10% or more on one or both of your policies.
Multi-policy discounts are common on home and car insurance bundles, but you’ll also find discounts for other bundles, like life and car insurance or multi-vehicle policies. If you rent a home or own a condo, certain companies also offer bundling discounts that include renters or condo insurance.
The benefits of a home and car insurance bundle
Getting a home and car insurance bundle can help you save money on your premiums. But it’s not the only benefit you can receive from bundling insurance policies together. Be sure to factor in these benefits when comparing insurance quotes from different providers:
- Multi-policy discount: Getting a discount on your premiums is likely the biggest reason to bundle your policies. If you’re already buying multiple policies, it makes sense to look for a multi-policy discount that suits your needs. This could cover your insurance requirements and save you money at the same time.
- Simple management: It’s likely less hassle to manage your payments and policies if they’re all under the same roof. Instead of using multiple websites or mobile apps, you get to see all your information in the same place. This can save you loads of time, as well as potential headaches from making account changes or tracking payments to different providers. It’s hard to put a price on convenience, but it makes a difference.
- Loyalty perks: Certain insurance providers offer rewards or benefits to their loyal customers. This means if you stay with one insurance company for a while, you could receive additional benefits for your time. This could include reimbursement for a lost car key or a discount on your insurance policy. If you bundle policies with the same company, it’s easier to stick with it and earn more benefits over time.
Tips on how to bundle and save
Getting a multi-policy discount could save you a lot of money, but will it always be the right decision? As you prepare to bundle and save, keep these tips in mind:
- Don’t overbuy. It makes sense to look for a multi-policy discount to get the best bang for your buck on insurance policies. But if bundling policies means getting more insurance coverage than you want or need, it may not be worth it. Know how much car insurance you need before shopping around. This will help you get what you need without buying a policy that has too much coverage.
- Comparison shop. It’s easy to bundle policies with the same provider. But that doesn’t mean you’re getting the best deal. Check all the policies in your area to see what’s available before making a decision. This may involve using an insurance marketplace to get quick and reliable quotes or talking to an independent insurance agent who works with multiple providers. You might end up with a less expensive policy that beats the savings on a multi-policy discount.
- Read the terms. Be aware of affiliate insurers, or third-party companies, that your insurance provider may use affiliates to handle a part of your bundle. This is a common practice, but it can make it more difficult to manage your policies if you still have to deal with different companies. If the discount is more important than the convenience, it could still be worth it to deal with third-party providers.
- Check for fees: If you’re not sure how to switch car insurance, it’s not that complicated. But one thing to be aware of is that you might incur a cancellation fee if you cancel your existing policy early. If you are subject to a cancellation fee, make sure it’s less than your potential savings on the new policy.
How much do you save by bundling home and auto insurance?
The amount of money you could save by bundling home and auto insurance depends on your situation. Many insurance providers offer multi-policy discounts when you bundle two or more policies. This can help you lower your car insurance and is often more convenient than dealing with multiple insurance companies.
But bundling policies may not always save you the most money. Keep in mind that comparison shopping is likely the best strategy for saving money on insurance policies. If you check the policies and discounts of each provider, you’ll know which has the best deal. This could involve a multi-policy discount, but it might not.
Does Geico bundle home and auto insurance?
Yes, Geico bundles home and auto insurance and offers a multi-policy discount. This type of discount is common among most insurers because it provides an incentive to stay with one company. However, multi-policy discounts don’t always offer the best deal for insurance policies. To be sure, you need to shop around with each provider and see what they have to offer.
Other well-known companies that bundle home and auto insurance or auto and renters insurance include:
- American Family
- Amica Mutual
- Farmers Insurance
- Liberty Mutual
- State Farm
- The Hartford
Can you bundle renters and auto insurance?
Yes, many major insurance providers offer bundle-and-save deals for renters and car insurance policies. This could be confused with typical home and auto insurance bundles, which are not the same types of insurance coverage. Home insurance policies cover homes that are owned by homeowners. Renters policies are policies you would purchase for your apartment or house when you are a renter.
Insurers that provide both renters and auto insurance policies:
- American Family
- Amica Mutual
- Farmers Insurance
- Liberty Mutual
- State Farm
If you think a home and car insurance bundle could save you money, you’re likely correct. Multi-policy insurance discounts are one of the easiest ways to save money on car insurance and other insurance premiums. In addition, it puts your policies together under the same company, which makes it easier to manage your accounts and payments.
But don’t go for the first multi-policy discount you see. Remember that a multi-policy discount isn’t always the best option for saving money. Do your due diligence and research the available deals in your area from every insurance provider. This will help you find both the best discounts and best coverage options, whether you end up bundling or not.