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If you own a home and a car, you probably have insurance coverage on both. But because you likely purchased the policies at different times, you might have gone through a different insurance provider for each. And you could be paying more than you need to as a result.

Insurers typically offer discounts to customers who “bundle” their policies — that is, purchase both forms of insurance from the same carrier. They do this because the discount makes you more likely to purchase additional policies, and it reduces the risk that you’ll switch to a different insurer.

While bundling can save you money, you’ll want to shop around to find the best available rate for each of your insurance policies.

Here’s what you need to know about bundling home and auto insurance:

What is a home and auto insurance bundle?

Home and auto insurance help protect two of your most valuable assets. When shopping for these policies, you might come across what’s known as a bundling discount, or multi-policy discount. Insurance carriers offer this incentive to entice customers to take out multiple policies with them.

Combining your home and auto policies can save you 5% to 15%, according to the Insurance Information Institute, but some insurers may offer steeper discounts.

With the average homeowner paying $1,272 per year for homeowners insurance and $1,204 annually to insure a vehicle, according to the National Association of Insurance Commissioners, bundling could save you more than $500 per year.

However, don’t assume the first discount — or policy — you’re offered is the best. You’ll have to shop around to be certain you’re getting the best deal available to you. Credible makes it easy to compare policies and rates from different insurers to help you get the best policy for your needs, at a great rate.

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Benefits of bundling home and auto insurance

The exact amount you save by bundling your homeowners and auto insurance policies varies by insurer. But saving money isn’t the only reason to bundle your policies. Other benefits include:

  • Simplified policy management: Having all your policies with the same insurer makes it easy to view and change your coverages, review your bills, and make payments because you can do it all from a single account.
  • Insurance security: Bundling your policies might make your insurance provider less likely to drop your homeowners coverage in the event you file multiple auto claims.
  • Combined deductibles: Some insurance companies set a single deductible that’s shared between all your policies. So rather than have to meet one $500 deductible for damage to your home and another $500 deductible for damage to your car resulting from the same windstorm, for example, you’d have just one $500 deductible that applies to both assets.
  • Increased savings: Bundle discounts and other policy discounts aren’t an either/or opportunity. You can stack discounts for even more savings.

Learn More: What Does Homeowners Insurance Cover?

Drawbacks of bundling insurance policies

Bundling auto and home insurance policies makes sense for many consumers, but it’s not always the best way to go. Consider these potential drawbacks:

  • Coverage can fall short: Bundle discounts may encourage you to shop by price rather than by coverage. Coverages vary from one insurer to another, and failing to put coverage first can leave you underinsured.
  • Bundling discourages shopping: If you feel like you’re getting a rock-bottom price on your policies, you might be less inclined to shop for a better deal.
  • Reduced flexibility: Bundling policies means you have to accept whatever coverage the insurer offers. You might find that the best home insurance and car insurance policies come from two different providers.
  • Not always cheaper: An insurance carrier with higher premiums than competitors charge won’t necessarily discount a bundle enough to save you money.

Check Out: Full Coverage Car Insurance: What Does It Mean?

How to save the most money bundling policies

You can expect to save at least 5% on your premiums if you buy two or more insurance policies from the same carrier. But to maximize your savings, try these tips:

  • Review your policies. Review your insurance coverages periodically to make sure you’re not paying for coverage you no longer need — for example, an endorsement for an expensive musical instrument you no longer own or collision insurance on a low-value car.
  • Look for additional discounts. Maybe your credit score has improved or you’ve retired since you first took out your policy. These life changes might qualify you for lower rates. You might also have earned a discount if you’ve recently installed sophisticated security or safety equipment in your home.
  • Shop for quotes. While you’re reviewing your coverages and hunting for discounts, do some comparison shopping to see if you can find the appropriate coverage for less at another carrier.
  • Consider increasing your deductible. It’s important to make sure you can pay your deductible in the event you need to file a claim; otherwise, you won’t be able to complete repairs to your home or car. However, you might be able to get away with a higher deductible if your insurance provider combines deductibles for bundled policies.
Good to know: A deductible is the amount you pay out-of-pocket before your insurance begins paying for a covered event or peril. Deductibles work the same for homeowners and auto insurance. Generally, the higher your deductible amount, the lower your premium will be.

Is bundling home and auto insurance right for me?

Bundling policies could save you money, but not always. It makes sense to compare quotes for both bundled and separate policies from a few different providers.

That said, some circumstances are well-suited to bundling, and some are not:

  • Large homeowners insurance policy: The larger your policy, the more you stand to save. If you’re insuring a high-value home or a home in an expensive market, a bundle could earn you a significant discount.
  • Poor credit: Bad credit history might prevent you from getting preferred rates from some insurers. Low-cost policies, even if from separate insurers, could cost you less than bundled policies from one insurer with stricter credit guidelines.
  • High car insurance premium: If tickets, accidents, or other circumstances have resulted in unusually high auto insurance premiums for you, a discount auto insurer will probably be a less expensive option than bundled policies from a traditional carrier.

Shopping for homeowners and auto insurance is serious business that can mean the difference between securing your financial future and exposing yourself to unnecessary risk and expense. That’s why it’s important to compare rates with multiple carriers before purchasing a policy.

Credible lets you compare rates from more than 40 reputable partner carriers. Our platform is easy to use, and you’ll have the information you need quickly so you can find a great deal on the best policy for you.


Need home insurance?
The Credible marketplace, which includes insurance services by Young Alfred, makes it easy to find a carrier and policy that’s right for you.

  • Fully online — Fill out all insurance forms online and buy homeowners coverage without ever picking up the phone. If you have any questions, Young Alfred offers 24/7 customer service.
  • Save time, money, and effort — Compare quotes from highly rated home insurance carriers in your area. It’s fast and easy.
  • Data privacy — Your information is kept safe and secure. We don’t sell your information to third parties, and you won’t get any spam phone calls from us.

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Disclaimer: All insurance-related services are offered through Young Alfred.

About the author
Daria Uhlig
Daria Uhlig

Daria Uhlig is a contributor to Credible who covers mortgage and real estate. Her work has appeared in publications like The Motley Fool, USA Today, MSN Money, CNBC, and Yahoo! Finance.

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