In 2018, US consumers spent an average of $9,081 on improving their home alone. Most of that went towards home improvement projects, while others were for maintenance. That didn’t include spending on homeowners insurance yet.
During the same time, the average vehicle spending in the US was $9,576 per year. Over a third of that ($3,554) was for expenses outside of gas, motor oil, and vehicle purchase. Meaning, a portion of that $3,554 went toward insurance costs.
Ready to learn what bundling is, how it works, and when you should do it? Keep reading then, as that’s exactly what you’ll learn in this post!
Four Major Types of Discounts
What Does It Mean to Bundle Insurance?
The US (including its territories) is home to almost 6,000 insurance companies. Over 2,500 of these insurers provide property and casualty insurance (P&C). Both car and home insurance firms belong to the P&C group.
With that said, many P&C insurance companies in the Bay State provide both home and auto insurance. These are the insurers that allow consumers to bundle home and auto insurance. They are companies that usually offer bundling discounts.
When you opt for a car and home insurance bundle, it means that you buy both from a single insurance company. Note, however, that this is only one way to bundle insurance. You can also bundle other types of coverage with them, such as pet or motorcycle insurance.
Why Do Insurance Companies Offer Bundling Discounts?
Insurers offer bundling discounts for the primary goal of attracting policy buyers. They know that most consumers who need a homeowners policy also often need auto coverage. In Boston, for instance, the rate of car ownership grew twice more than that of the population from 2012 to 2017.
There’s also tight and fierce competition within the insurance segment. With so many other insurers in the US, they know that discounts are an excellent way to stay competitive. They offer such programs not only to attract shoppers but also to make policy owners stick to them.
Policy shoppers themselves contribute to this, as at least 44% of them compare quotes. With smarter buying practices, many of them now shop around for better deals every six months or so. As such, insurers make it a point to offer better discounts, with bundling being one of the most popular.
Why Should You Bundle Home and Auto Insurance?
The biggest reason to take advantage of the best auto and home insurance bundle is to save money.
If you combine insurance policies under one provider, you can get a huge discount. As noted above, these money-saving deals can net you up to 35% less than if you bought separate policies. Most insurers refer to their bundling offers as the “multi-policy discount.”
Aside from immediate discounts, bundling can also help you save on deductibles. This often applies to circumstances that involve multiple claim events, though.
For instance, if a tree falls on your property, it may damage not only the garage roof but also your car. If your home and auto insurance are from different providers, you’d need to make two claims. You’d need to work with different insurers and pay separate deductibles.
If you bought a homeowners and auto insurance bundle, then you only have to work with one insurer. You may only have to file a single claim for both damages or losses. Your insurer may also only require you to pay a single deductible.
Other Ways on How You Can Save by Bundling Home and Auto Insurance
As you can see, there’s a lot that you can save on if you bundle your home and auto insurance policies. That’s not the end of it, though, as this practice can unlock other not-so-obvious savings.
Here’s how bundling can save your golden time, gas, and even phone minutes.
Less Time Spent on Dealing With Insurers
Let’s say you need to make multiple, simultaneous claims. Let’s also say that you have separate insurers for each claim you have to file.
In this case, you’d end up spending a lot of time since you need to go to at least two different insurers. If the insurers need to clarify your claims, you’ll spend even more time dealing with them.
You may also end up having to work in two separate schedules for insurance adjusters. This may occur in the same fallen tree example mentioned above. If this happens, an adjuster from each of your insurers would have to visit your home for the assessment.
While the assessment may not take an entire day, the process of getting an appointment does. Also, since the adjusters are from different firms, you likely won’t get a same-day schedule. This may then require you to take some time away from work or other vital tasks you need to do.
So, not only would this inconvenience you, and may also end up losing paid time at work. Even if you can schedule the survey on the weekend, it’s still a hassle, since it should be your time to rest.
On the other hand, if you have a policy bundle, you only need to file a claim with a single insurer. Your sole insurance provider will also likely need to send just one adjuster. Moreover, the adjuster would likely perform all the required assessments in one day.
Cut Down on Paperwork (And Carbon Footprint)
This type of savings may seem tiny, but a little goes a long way if you want to reduce your carbon footprint too. For example, whenever you have to file an insurance claim, you’d likely need to print a lot of documents. If you have different insurers, you’d need to print twice, thrice, or even more than that.
That’s a lot of paper, not to mention more carbon footprint.
This is something you can avoid if you carry multiple policies under a single provider.
Less Gas, Fewer Phone Minutes To Use
If you have policies under separate insurers, you may have to visit or call different offices. In either case, you’ll spend more money on gas or phone minutes.
Again, these are costs that an insurance bundle can help you avoid and, instead, save on.
When Bundling Insurance Is an Option
Bundling is a great option if you’re in the market for two different insurance policies. Savings aside, there are other instances wherein this practice is even more helpful.
Let’s take a look at some of these situations.
If You Live in a High-Risk Area
In Massachusetts, a Category 1 hurricane storm surge puts 8,102 homes at severe risk. This goes up to 151,979 at-risk houses if the hurricane goes up to Category 4.
Flood hazards are also increasing in the Bay State, with at least six communities being at the most risk. By 2045, experts say that at least 7,000 of today’s houses are at the highest risk of chronic flooding.
With that said, if you live in a high-risk home, bundling can help you keep it insured. That’s because some insurers may cancel stand-alone homeowners policies on high-risk properties. If you buy more than one policy from one insurer, you can reduce the odds of having your coverage cancelled.
If You Need More Than Just Home and Auto Insurance
Many insurers also offer discounts for multi-policies other than home and auto coverage. Aside from these two, some insurance companies also issue boat insurance. It’s also common for P&C coverage providers to sell in-home business and pet insurance.
If you need a lot of these policies, then it’s all the more reason to opt for a bundle. They can save you not only more money but also on gas, phone minutes, and most importantly, time.
One more thing: some insurance companies also offer multi-vehicle discounts. If you have more than one car at home, be sure to let a potential insurer know. They might raise your discount if you buy all your vehicle insurance policies from them.
When Bundling Insurance May Not Be the Best Idea
Bundling insurance is always an excellent option to save, but more so if you need to buy policies at the same time. However, it’s crucial to note that there are some cases wherein mixing and matching may be best.
Here are a few examples of such situations.
You Own a High-End or Special Class of Vehicle
High-performance, super expensive, or classic cars often require a particular type of coverage. Keep in mind that standard auto insurance policies often come with minimum limits. As such, if you own any of these vehicles, it’s best to get a separate policy instead of a bundle.
Do note that some P&C insurers still offer special coverage for expensive vehicles. In this case, you should consider speaking with an insurance agent to help you with your search. These experts may be able to help you unlock discounts on special vehicle coverage.
You Have Existing Riders That You Need
Insurance riders are the “add-ons” to your policy that expand your coverage. An example is personal articles insurance, a floater policy for high-value items. If you have this in your current homeowners policy, you’ll no longer have it if you go for a bundle.
You still do have an option to add it to the new bundle, so long as the new insurer offers it. If not, then you’d need to purchase a separate floater policy.
Possible Reduction In Your Coverage
Bundling policies may also have a reducing effect on your limits or coverages. This may lead to more out-of-pocket costs if you sustain severe property damages or losses.
So, before you get too attracted to the discount, be sure to review the included coverages first.
The Best Ways to Bundle Your Home and Auto Insurance
The most crucial bundling tip is to always compare home and auto insurance bundle quotes. This is the best way to determine who has the cheapest home and auto insurance bundle. Remember, each policy shopper has different coverage needs, so the rates still vary.
Therefore, insurance companies also need to know what your circumstances are. This way, they can provide you with accurate estimates. Only then can you figure out which of these insurers have the best deal that suits and meets your needs.
On that note, here are other crucial reminders for when you shop around for insurance bundles.
Other Required Coverages
Consider your other coverage needs, such as if you also have to buy insurance for a boat or motorcycle. It’s possible to get even more savings if you go with a single provider that offers coverage for all your assets.
Don’t forget to check if the insurer offers the same riders or floaters that you currently own. If they offer the same add-on coverages, you may be able to add them to your new policy right away. Be sure to find out how soon they can issue the “mini-coverage” before you cancel the existing one though.
Always Check the Limits
When you do decide to get an insurance bundle, take the time to look into the limits too. Then, compare these with the actual value of the property you’d like to insure. The bundle’s coverage amounts should be enough to ensure you receive adequate protection.
This is also the best time to carry out a home inventory. This is the process of noting all your possessions and then valuing them up. It does take quite some time, though, but still, it’s the only way to get an accurate value of your property.
By knowing how much is at stake, you’ll be able to figure out how much coverage you do need.
Get the Best Bundle Now With the Help of an Insurance Agent
As you can see, bundling your home and auto insurance policies offers you a lot of ways to save time and money. More than that, it’s super convenient, since you only have to deal with a single insurer. Plus, if you want to modify your coverages, you can do so through just one website or app.
Would you like to start your search for the best auto and home insurance quotes today? If so, then our team here at the LoPriore Insurance Agency is ready to help. Give us a ring now, and we’ll be happy to assist you in your search for the top insurance bundle deals.