You could get a big discount on your rates if you bundle policies. This means buying home, auto, or other types of coverage from the same provider. Most insurers offer several different types of insurance, making it easy and, often, more affordable to combine the protection you need under one account.
This article will tell you all about how insurance bundling works, including the best ways to combine your policies so you can maximize your savings. Here’s a breakdown of what we’ll cover:
- Defining an insurance bundling
- The benefits
- Types of insurance bundles
- How to do it
- Whether you should do it or not
- Answering common questions
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What Is Insurance Bundling?
Bundling is when you combine different types of coverage under the same company. Having both home and auto under one provider is an example of a bundled policy. Doing so can lower your rates. It can also be more convenient to keep all of your coverage under the same carrier. Note that some home and car insurers call this the multi-policy discount.
The Benefits of Insurance Bundling
Combining multiple insurance products together has many advantages. The benefits can vary with each company. Some offerings are more generous than others. But every bundling discount shares one thing, they all save you money.
Here are the main reasons to bundle:
You’ll Save Money by Bundling Insurance
Bundling your auto insurance policy with other types of coverage is one of the best ways to lower your rates. For example, American Family says that customers will save up to 23% if they purchase both home and auto from them. These are huge savings that you can’t look past.
Companies also love to reward their customers for their loyalty. Sticking with the same provider for all of your needs can pay dividends. You also get a discount on your premiums if you stick with the same company for a long time. Insurers will consider you loyal and reflect it in your rates with a customer loyalty discount.
It’s Convenient to Bundle Insurance Policies
This one’s basic but important. When you bundle insurance policies under the same provider, it can save you from wasting extra time and stress. You won’t have to keep track of a bunch of different companies and their various prices or renewals. This makes it so you have less paperwork to sort through when managing your finances.
Bundling makes it easy to pay for all of your policies with just one payment. Everything will be under one roof. If you need to call customer service, you can take care of everything all at once. It’s also a comforting fact that you will likely save more money in the long run.
Bundling Can Allow for More Flexibility
Keeping all of your insurance under one provider can provide you with more flexibility. Most carriers are willing to work with you if you need to change or add more coverage. For example, you might want to shift from renters to homeowners if you just bought a new house. You can always add a new product to your policy with no hassle. Insurers and your agent can help you easily add or switch policies while still keeping everything in a bundle.
How Do I Bundle My Insurance?
Insurance companies make it very easy to join your policies together. This is because they offer several packages that you can select, and which fit your needs. To bundle, you’ll need to contact your desired carrier and get the ball rolling with the policies you desire. Keep in mind that only certain kinds of coverage qualify, so you’ll want to know if the insurer you want to work with offers what you need.
Types of Insurance You Can Bundle
Insurers offer multiple products that you can combine. Here are the most common types of insurance you can bundle:
- Boat and watercraft
- Life insurance
These are only some of the coverages you’re able to package together. Be sure to check with your agent to find out what exactly qualifies. Note that not all insurance companies offer the same bundles. You may need to do some research to find what carrier is best for your needs.
What You Can’t Bundle
While you can bundle many forms of insurance, here are some that you can’t:
- Any type of coverage that your provider doesn’t offer
Bundling only works if the company offers both coverages. For example, if a provider doesn’t offer renters or motorcycle insurance, you can’t add them to your auto policy. Make sure to check with your agent or insurer to find out if you can combine your coverages.
You don’t just have to bundle two coverages together. There’s also the option of having an all-in-one type of policy. This means buying all of your insurance with the same provider for what would likely be a big discount.
How Much Do You Save When You Bundle Insurance?
It’s no secret that bundling your policies can save you money. But the savings aren’t the same across the board. You should expect to save anywhere from 4 to 25% when all of your insurance needs are met by a single provider. Progressive claims that its customers save an average of 4%.
Compare Insurance Bundling by Company
Here’s a table to help you compare auto and home insurance bundles between the top companies:
|State Farm||Up to $1,127|
|Progressive||4% on average|
|Allstate||Up to 25%|
|American Family||Up to 23%|
|GEICO||Can vary based on rate factors|
|Liberty Mutual||Up to $947|
|Nationwide||Up to 20%|
|USAA||Up to 10%|
|Farmers||Up to 20%|
|Travelers||Up to 13%|
|Erie||Varies by State|
|Farm Bureau||Varies by State|
|Shelter||Varies by Coverage|
|COUNTRY Financial||Up to 25%|
|Mercury||Up to 15%|
|Amica||Up to 30%|
|NJM||Varies by Coverage|
Keep in mind that the discount you get will also depend on different factors, such as:
- Age (under or over the age of 25)
- Where you live
- Driving record
- Car mileage
- Driving experience
These are also details that affect your premium. Insurers use these to calculate your premiums and it’ll be unique for every customer.
What Are the Best Companies for Bundling Home and Auto?
There are several options out there to combine your home and auto coverage. This is the most common bundling option. Each company offers its own discount. Keep in mind that how much you save can also depend on rate factors unique to you, such as your age, credit rating, and driving record.
These are our top picks for the best home and auto insurance bundles:
- State Farm
- American Family
Should You Always Bundle Insurance Policies?
Bundling policies has great benefits for those who want to do it. But not everyone should. In some cases, it might be cheaper to use different companies for each policy.
There’s no guarantee that putting your trust in only one insurer will save you money. Rate factors such as your age, gender, and place of residence can affect what type of savings you’ll receive. Providers may also not carry the coverage that you want, or it may not be for the right price. To make sure you get the best rates, it’s a smart practice to compare quotes from top companies.
Here’s why it might not be worth it:
- After comparing, it’s clear that you will save more by using separate companies.
- Another company has a really good deal on homeowners or other products, but you still want to keep your current provider for auto.
- Rate factors such as your driving record, credit history, and age affect your ability to get a discount.
Consolidating your policies can be a great way to save extra on your rates. But be sure that you’re maximizing your savings, either through bundling or by using separate companies for each policy.
Frequently Asked Questions
Can you bundle health insurance with auto?
No, health insurance is a standalone coverage that cannot be bundled. This is a common misconception about this discount. Pet and health usually can’t be combined with other policies. Typically, you’re allowed to add the following to your auto policy:
Remember that companies don’t always offer the same insurance types. Or they do offer them, but not as a package deal. Be sure to check with your insurer about what coverages qualify.
Is it always cheaper to bundle car and homeowners?
It’s not always cheaper to bundle auto and homeowners. What you should do really depends on how much you can save. Companies don’t always offer the same discount. American Family can save their customers up to 23%, while Progressive averages savings of around 5%. You’ll want to check your rates for each company to find out what you’ll need to pay. This is the surefire solution to know if it makes sense for your situation.
Can I buy auto insurance and then bundle it with home later?
You can always add on a new product later. If you just bought a house and need to cover it with homeowners, you might want to add it with the same company that carries your auto policy. Insurers make it easy to do so.