Personal
How bundling home and auto insurance works
What a bundle really is, when it saves you money, and how to check that both policies still fit before you sign.
Short answer
Bundling just means buying your home and car insurance from the same company. You'll often get a discount for it. But a discount only helps if both policies still fit you, so compare the bundle with two separate policies.
What does bundling actually mean?
A bundle is two or more policies from the same insurance company. The classic pair is home and car. But renters and car, condo and car, or car and boat can count too. It depends on the company.
You still get separate policies. Each one has its own coverage, its own limits (the most the insurance company would pay), and its own renewal date. Bundling usually doesn’t merge them into one contract. It just ties them together for pricing.
Some companies call it a multi-policy discount. You might see that line on your declarations page, the summary at the front of your policy.
Where do the savings come from?
Insurance companies like customers who buy more than one policy. Those customers tend to stay longer. So many companies take something off the price of one or both policies when you bundle.
How much is up to each company, and it changes. Here’s how the math can look. Say your home policy costs $1,600 a year and your car policy costs $1,400 on their own. With a bundle discount, that company might charge $2,700 for both. That looks like a deal.
Now say a second company charges $1,300 for the same home coverage. A third charges $1,200 for the same car coverage. That’s $2,500 total, with no bundle discount at all. The bundle isn’t always the cheapest way to buy.
What else changes when you bundle?
Price isn’t the only thing that changes. Here’s how the two choices usually stack up.
| What changes | Bundle with one company | Separate policies |
|---|---|---|
| Discount | Often a multi-policy discount | Usually none for this |
| Bills and renewals | One company to deal with | Two companies to manage |
| A claim that hits both | Some companies charge just one deductible | Usually a deductible on each policy |
| Switching later | Moving one policy can end the discount on the other | Each one can move on its own |
| Fit | Both come from one company’s menu | Each can come from the company that fits it best |
When one storm hits both
Say a storm drops a tree on your garage and the car parked inside. Your home policy may cover the garage. If you have comprehensive coverage, your car policy may cover the car. That’s the part for things like falling trees, hail, and theft.
Each policy usually has its own deductible, the part you pay first on a claim. Say both are $1,000. You’d pay $2,000, and the insurance company would typically pay the rest of the covered damage. Some companies let bundled customers pay just one deductible when one event damages both. Not every company does this, so check your policy or ask us.
Note
Leaving one policy can change the price of the other. Say you move your car insurance somewhere cheaper. Your home policy may lose its bundle discount at the next renewal. Check both prices before you switch either one.
When is a bundle a bad fit?
A bundle only helps if both policies cover what you need. Watch for these trade-offs.
- A weak policy hiding in the deal. Some companies are strong on car insurance but less so on homes, or the other way around. A big discount can hide lower limits or missing coverage on one side.
- A home that’s hard to insure. An older roof, past claims, or a house near the coast can push one company’s price way up. A company that likes homes like yours may beat the bundle.
- An add-on you’d lose. Say you want extra coverage for an engagement ring. That’s an endorsement, an add-on that changes the policy. If the bundling company doesn’t offer it, the discount may not be worth the gap.
How do you compare a bundle the right way?
- Start with your current declarations pages for home and car.
- Ask for quotes with the same limits and deductibles on every one.
- Compare the bundle total with the best home price plus the best car price from separate companies.
- Look past the price at the coverage in each one. Then decide.
Thinking about umbrella insurance? It’s extra coverage for times you’re blamed for someone else’s injury or damage. Some companies only sell it if your home and car are with them too. That can tip the math toward a bundle.