Buying home and auto insurance from the same company—commonly known as “bundling”—is one the easiest ways to lower your insurance costs.
That’s because most major insurance companies offer discounts for bundling your home and auto insurance, sometimes as much as 25% off your premiums.
“Most homeowners have homeowners insurance, so getting a quote to see if bundling their auto and home with the company could save money is wise,” says Laura Adams, an insurance expert with AutoInsurance.org and host of the “Money Girl” podcast.
But bundling doesn’t always guarantee savings, and it may not make sense for your personal situation.
When you’re shopping for coverage, ask insurers if they partner with other third-party insurance companies, or affiliates, for auto or home insurance policies. If they do, you’ll lose the convenience of bundling because you’ll have to deal with two insurance companies instead of one.
“There are some situations where getting separate policies with separate carriers is actually less, so you want to shop it both ways,” says Adams.
According to a 2018 J.D. Power study, 20% of home insurance customers who also have auto insurance do not bundle their auto policy with a home policy.
Here’s what you need to know about bundling your auto and home insurance with the same company.
How Much Can You Save By Bundling Insurance?
The most significant benefit of bundling your car and home insurance is the savings you’ll get from a multi-policy discount. Sometimes, you can save up to a few hundred dollars by bundling, depending on your coverage and the insurer.
If you own a home and a car, you’re in an ideal position to bundle. If you have more than one car or more than one home, the discounts for bundling can be even more lucrative.
For example, the average car insurance premium with Travelers Insurance is $1,428, and its average homeowners insurance premium is $1,269. If you qualified for a 10% discount with bundling, you could shave roughly $143 off your auto insurance bill on average.
Which Companies Offer Home & Auto Bundles?
Just about every major insurance provider offers a discount for having multiple policies, ranging from 5% to 25%. But the largest discount doesn’t always mean the cheapest rate for home and auto insurance.
“A discount is really just the inverse of a surcharge. Either they’re giving you a lower rate because you do something or have some quality or they give you a higher rate because you don’t have a certain quality,” says Douglas Heller, an insurance consultant and expert with the Consumer Federation of America (CFA), a nonprofit consumer advocacy group.
For example, USAA offers the smallest average discount, but it also has the cheapest policies overall, with the total bundled premium averaging $2,244. Nationwide offers a 20% discount when you bundle two or more policies, but it’s also one of the more expensive bundles at around $2,500 per year on average.
Here’s a list of companies that we think stand out for their low rates and multi-policy discounts:
|Insurance Company||Average Car Insurance Premium||Average Homeowners Insurance Premium||Bundle Discount|
|USAA||$1,252||$992||Up to 10%|
|Progressive||$1,419||$1,026||Up to 5%|
|Nationwide||$1,475||$1,042||Up to 20%|
|Travelers||$1,428||$1,269||Up to 10%|
How to Get the Best Deal on a Home and Auto Insurance Bundle
Bundling your home and auto insurance can save you money every year, and it can be more convenient to rely on the same company for multiple policies. But a multi-policy discount, even if it’s high, won’t always result in the lowest price. Here’s how you can get the best deal on home and auto insurance:
Start by calculating what you’re currently paying for home and auto, and have this number handy so you can compare it to bundle rates. You’ll want to gather at least three to five quotes, with and without bundling, to find the best rate and coverage.
“A really good discount off a $1,000 policy might still leave you with higher-priced insurance than a no-discount $700 policy,” says Heller. “Don’t be lured in by discounts — look at the final rate.”
Ask About Your Deductible
If you bundle your home and auto insurance, some insurers offer perks like a single deductible on claims involving both your car and house, as well as only one bill for all of your policies. Progressive, for example, offers this feature. When you’re shopping for coverage, ask whether you’ll be responsible for one or two deductibles if you buy your home and auto insurance with the same company.
Shop Around Regularly
Most experts we spoke to recommend shopping around for home and auto insurance at least once a year to ensure you’re not overpaying or underinsured. Price is an important factor to consider when shopping for insurance quotes, but it’s not the only one. You’ll also want to look at an insurance company’s customer satisfaction rates, online reviews, and financial strength ratings to make sure it’s reliable and financially stable.
“It’s worth asking what kind of discount you can get for having multiple policies with the same company, but it shouldn’t drive your decision,” says Heller. “You want to make sure you’re getting the best rate, not the best discount.”