The benefits of bundling your home and auto insurance

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Bundling discounts, sometimes called multi-policy discounts, are common among insurance companies that offer different lines of insurance. The most common multi-policy discount is for home and auto insurance bundles. Bundling insurance does not mean that your home and auto are insured on the same policy; it only means that they are insured with the same carrier. Finding the best home and auto insurance bundles for your needs may save you hundreds of dollars on each of your policies as these discounts are often some of the largest available.

Why you should consider bundling your home and auto insurance

Bundling your auto and home insurance can be a great way to generate significant savings and make your insurance more convenient to handle. If you own a home and have a car, getting quotes for both policies with the same insurer could be well worth your time.

However, bundling is not the right fit for every driver or every homeowner. Some drivers, like high-risk drivers, might be limited in their choice of auto insurance companies. Not all auto insurers sell homeowners insurance, which means bundling the two policies might not be an option. Similarly, if you have very specific needs for your home insurance — perhaps you made a personal liability claim recently and your policy needed to be switched to a high-risk home insurance company — bundling may not be an option for you.

In some cases, bundling may not be financially beneficial. One company may offer you a low rate for car insurance, while another could offer you the lowest rate on home insurance, even without a bundling discount. However, if you are able to bundle home and auto insurance, you might notice some benefits. Bundling can make both your home and auto insurance cheaper and easier to manage.

Savings

Perhaps the most significant benefit of bundling policies is the opportunity to save money on your premium. Most companies that offer both home and auto insurance offer a discount for bundling policies. These discounts are typically some of the biggest savings opportunities available. However, it is still important to get quotes from several insurers for your home and auto bundle. Every company has its own rating systems and discount levels, so comparing several insurance companies for both types of coverage might help you find the best deal for you.

Convenience

Having multiple insurance products with one company can make handling your insurance needs easier and faster. You may be able to view information for both policies in the same online account, for example, or within the company’s mobile app. Having insurance policies with several different carriers can make it difficult to keep track of contact information, which could mean that making changes or filing claims might be slower or more difficult. The convenience of having your home and auto policies bundled with one carrier means that you may be able to handle your insurance needs more easily.

Fewer bills

Depending on how your home insurance is paid, you might be able to combine bills, which can be helpful when you are budgeting. If you have a mortgage, your home insurance typically is billed directly to your lender and paid from your escrow account. But if you own your home outright or if you do not have an escrow account, you might be paying your home insurance directly. If this is the case, you may be able to combine your policies into a single billing account. This means that you will only receive one bill each billing cycle — whether you pay monthly, quarterly, semi-annually or annually.

Single deductible

A few carriers offer a “single deductible” feature when you insure both your auto and home with them. Although the specifics will vary by insurer, typically this feature means that if both your car(s) and home are damaged in a single event — e.g., a storm collapsing your roof onto your garage and parked car, for example — you will only pay one deductible for all the damage.

Best home and auto insurance bundles

Most insurers that sell both auto and home insurance offer multi-policy discounts, but the savings vary depending on individual carriers. You will typically see savings on both policies. The following table illustrates the amount you can save on your auto insurance by bundling policies with some of the largest U.S. insurers.

Company Average annual car insurance premium Typical bundle discount
Allstate $1,921 Up to 25%
Nationwide $1,485 Up to 20%
State Farm $1,457 Up to 17%
Travelers $1,325 Up to 10%
USAA $1,225 Up to 10%

When shopping for policy bundles, it is important to review your quotes carefully. Finding a competitive price for your insurance is a priority for many, but the premium is not the only factor you should review on a quote. You may also want to consider the coverages and policy features for each home and auto quote you received, as well as each company’s customer satisfaction scores and financial strength ratings.

How to bundle your car and home insurance

Bundling your car and home insurance is relatively easy. Although it may sound like you are getting a combined auto-home insurance policy, this is often not the case (although some companies do offer auto and home policies written under a single policy number). You will generally need to purchase your auto and home insurance with the same insurer to qualify for a bundling discount. Here are some steps you can take to bundle your policies:

  1. Decide what you want from your insurer. Determining if you are looking for exceptional customer service, a highly rated mobile app or certain coverages, for example, can help you decide which companies to get quotes from. It may also be beneficial to work with an insurance professional who can provide you with guidance throughout this process.
  2. Get quotes from multiple companies. Once you know what qualities and coverages you are looking for, you can request auto and home quotes from several different companies.
  3. Review each quote carefully. Assess each auto and home quote carefully to determine if the coverages, premium and details included are accurate and fit your needs.
  4. Choose a company and start your policies. Once you have decided which insurer suits your home and auto insurance coverage needs best, your insurance representative can walk you through the steps to start your policy.
  5. Cancel your previous insurance policies. If you already had home and auto insurance with other carriers, you will need to cancel your policies. When switching to a new carrier, it is typically best to wait to cancel your prior policies until you know the effective date of the new policies, so you can avoid a lapse in coverage.

How to save the most by bundling

Bundling your auto and home policies could save you money, but there are still ways you can maximize your savings.

  • Get quotes from several insurance companies. This is important, as every carrier has a different rating system. For instance, your bundling discount could be 25% with a carrier, but if the underlying rates are higher than other insurers, you could end up saving more with a carrier that has lower rates for you — even if their bundling discount is smaller.
  • Take advantage of other discounts. Having a multi-policy discount on your auto and home insurance does not preclude you from applying other discounts. Utilizing other discounts that you qualify for might help you save additional money on your premium.
  • Increase your deductibles. Your home policy’s deductible is the amount you will pay out of pocket if you file a claim for damage to your property. If you have full coverage auto insurance, your policy has two deductibles: one for comprehensive and one for collision. Raising your deductibles generally lowers your premium. However, it means you will need to pay more out of pocket if you file a claim for home or vehicle damage, so be sure to choose your deductible level you can afford.
  • Review your policies when life events happen. Staying with the same insurer for several years can be a good way to earn loyalty discounts, but occasionally shopping your coverage with other carriers can help you learn if you are still getting a competitively-priced bundle. It can be helpful to shop for insurance after significant events in your life that tend to alter your finances, like getting married, having a baby or moving.

Frequently asked questions

What is the best home insurance company?

There are many home insurers on the market and there is not a single company that is the best for everyone. To find the best home insurance company for your needs, you might want to get quotes from several providers and compare the coverages, discounts, policy features and premiums.

What is the best auto insurance company?

Just like with home insurance, no auto insurance company is the best for every driver. Everyone has different rating factors, different levels of risk tolerance, different coverage needs and different wants when it comes to a company. Understanding what you are looking for from a company and obtaining multiple quotes can be helpful.

What policies can I bundle together?

The most common type of bundling discount is for home and auto insurance policies. However, many providers also offer a discount for bundling an auto insurance policy with a condo owners or renters insurance policy. Some companies even offer bundling discounts for buying other types of policies with your auto insurance, like a life insurance, pet insurance or business insurance policy.

Is it worth it to bundle home and auto insurance?

If you qualify for both auto and home insurance with a single carrier, it can often be financially worthwhile to bundle your policies. Multi-policy discounts are often some of the biggest discounts that insurers offer. However, you might find that you can purchase separate auto and home policies with different companies and still get a lower rate on each, even without a multi-policy discount. And in some cases, bundling may not be available to you if your preferred auto or home insurer does not sell other lines of insurance.

Methodology

Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on a 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:

  • $100,000 bodily injury liability per person
  • $300,000 bodily injury liability per accident
  • $50,000 property damage liability per accident
  • $100,000 uninsured motorist bodily injury per person
  • $300,000 uninsured motorist bodily injury per accident
  • $500 collision deductible
  • $500 comprehensive deductible

To determine minimum coverage limits, Bankrate used minimum coverages that meet each state’s requirements. Our base profile drivers own a 2019 Toyota Camry, commute five days a week and drive 12,000 miles annually.

These are sample rates and should only be used for comparative purposes.