Best Auto and Home Insurance Bundle (November 2023)
Expert Advice: Bundling Home and Auto Insurance
Dr. Aniruddha Pangarkar
Assistant Professor of Marketing at the University of Wisconsin-Green Bay
Is it always worth bundling home and auto insurance policies with the same company?
The United States has a very high number of insurance companies in the market, and they are all competing against each other to get new customers, along with creating strategies to get customers from their rivals and competitors. While many insurance companies leverage promotional and advertising strategies and propaganda, other strategies can also work well, such as bundling services from the same insurance provider, which allows companies to retain old customers and gain new ones. Such bundling is beneficial for the company and makes perfect financial sense for the customer—an example of a clear win-win situation. For customers looking at bundling services either from your existing provider or a new one, I recommend that you do not hesitate to call their customer service in case you need more clarity.
Almost all the big companies, including State Farm, Farmers, All State, Geico, Mercury, Progressive, etc., offer bundling of services. It could potentially save customers a substantial amount per annum in the long run. Along with the financial benefits, it is easier to manage policies with the same provider and keep track of everything in a more simplified manner.
Are there any downsides to bundling home and auto insurance?
While bundling services is often financially lucrative for the customer, there are certain situations where it might not be feasible. For example, many customers do not compare prices between different providers and simply assume that bundling by itself would be beneficial. I always recommend customers do comprehensive research and compare rates from different providers before choosing a bundled service option from a provider.
At other times, your insurer could pair you up with another partner company for home insurance, in which case it is important to get clarity on such aspects before signing the agreement. For certain individuals with poor credit scores, traffic violations or those who live in cities with high car insurance rates, your car insurance might work out substantially higher and offset any potential savings accrued from the bundling. In such cases, it is best to compare whether buying auto and home insurance policies separately is a better option.
What other types of insurance policies can shoppers typically bundle with either home or auto insurance?
For certain customers, it would be financially beneficial to check with the insurer and determine if bundling of home and auto (the two most common types of bundling) can also be combined with life insurance, recreational vehicles (RV), boats, etc. Again, the dynamics of how much savings can be accrued completely depend on the types of policies bundled, customer credit rating, and other factors that the insurer determines. If you feel you need additional policies, get different quotes from various companies, compare and contrast, and only then make your decision.