Bundling Car and Home Insurance: Pros and Cons

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If you are in the market for both car and home insurance, bundling might sound like a great deal. You only have to work with one insurance company, which is easier. You also get cost savings from the bundling discount. 

But bundling isn't always the right choice. While most companies offer discounts for bundling, there are many other factors to think about. Just the cost savings might not be the best reason to switch your car and home insurance or choose a new provider. 

Before you switch, you need to find out whether you really will save money. You also need to note any deviations from your current coverage. Once you know what the savings and plans will be, you can shop around for the best coverage and price.

Once you have plans from different companies to look at, you can work with the providers to ensure that your coverage meets your needs.

Key Takeaways

  • Bundling can be a way to save money by using the same insurance company for both your home and auto policies.
  • You may want to consider bundling if you want more savings, if you want to simplify your insurance, and if you make many claims.
  • Bundling might not be the right choice if it prevents you from shopping around, which means you could end up paying more.

What Is Bundling?

Bundling insurance occurs when you choose to buy several policies from the same provider. This may include your home insurance, car insurance, life insurance, and more.

Rather than having several different insurers for each policy, you use the same one. This may make it easier to pay premiums every month.

It can also save you money. Many companies offer discounts if you have multiple policies with them.

What if You Have Many Policies in One Family?

If you have more than one policy in the same household or family, you might be able to get a discount. This is known as a "multi-policy discount."

For instance, you might have a teen driver in the house with a separate auto policy. You can often get a multi-policy discount if the teen is insured through the same carrier as the parent in the home.

Not all insurers offer multi-policy discounts. Be sure to check with your provider before you assume you can get a discount for more than one policy.

What Are the Pros of Bundling Insurance? 

There are many reasons you might choose to bundle your insurance policies.

You Want More Savings

The bundling discount can save you a lot of money every year. This is the main reason most people bundle their insurance policies.

How much you can save depends on the company you work with. Some insurers report that if you choose to bundle your insurance, you could save up to 25% in premiums. Having multiple plans with one insurance carrier is one of the best discounts available.

You Want to Make Things Simple

The ease of working with only one provider is another reason some people choose to bundle. If you bundle both your car and home policies, you will only need to download (and learn to use) one app for both. You will only need to have an account with one insurer.

This will let you check all your plans, make claims, and pay premiums from the same place. It will also limit how many places store your banking information if you set up automatic payments.

You File a Lot of Claims

If you have too many claims on your home or car insurance, you risk being dropped by your insurer. Most are less likely to do so, though, if you are a client in both their home and auto divisions, but it isn't a guarantee. But for some people, it could be a helpful benefit.

What Are the Cons of Bundling Insurance? 

When you are shopping for insurance bundles, you might not spend as much time comparing prices between providers. This is helpful for the insurance company, but not for you.

Make sure you research the costs of policies before you start looking into bundling discounts to save the most money. It may be possible to find more than one provider with the same coverage and lower prices. This could add up to less than the total cost of a bundle with a different company.

If you have decided to bundle your car and home insurance, you it is possible to save on premiums—at least at first. This happens because bundling, by design, only works when you avoid shopping around.

Bundling also makes you less likely to shop around or switch providers to get a better price. Again, this is good for the company but less good for you. The company is more likely to keep your business, even if it no longer offers the best rates.


Some companies strive to build loyalty, which means you'll continue to receive a discount. Other companies will continue to offer you a "discount" but slowly raise the cost of your plans.

You might also find that the bundled plans you buy don't end up being through the same insurer. Some companies use affiliates. You will lose the ease of having only one company to work with, though. And if the affiliate relationship ends, you might need to shop around again or face a steep rate increase.

Before You Bundle Home and Auto Insurance

It takes work to stay on top of your insurance costs. Most people don't bother shopping around when it's time to renew, because it takes too much time and effort to research new plans.

If you are shopping for new insurance, don't just pick the first option. There are several points you can consider to help you decide.

Decide on Coverage

How much coverage do you need right now? If you pay for more, you are wasting money this year.

You might also be wasting money in the future. There's no guarantee that your needs will increase over time. You can always increase your coverage later if you do end up needing it.

Compare Costs

Compare more than prices within a single company. Look at the cost of separate policy premiums across multiple companies. Then, compare those to any bundled discounts that each company offers.

In some cases, buying separate plans from a cheaper company may be less expensive than bundling with a more costly insurer.

Know What You're Getting

Who is actually providing each part of your bundled plans?

If you do not want your insurance bundled through an affiliate, ask about it. You should know what companies you will be working with before you buy anything.

Don't Shop Just Once

Don't put your insurance on autopilot.

Your loyalty to the company you buy insurance from should not increase just because you have two insurance policies. Do your price shopping every few years.

Take stock of whether the plans you have are working for your needs and budget. If they aren't, don't let having a bundle keep you from looking for a new insurer.

You might be able to get the multi-policy discount on a policy in advance. For example, if you switch your auto insurance to a new carrier but want to switch your home policy when it renews, let your new carrier know. As long as you commit, you might get a discount before the switch even happens.

What Else Can You Bundle?

With more traditional companies, you will likely only get a multi-policy discount on your auto insurance policy if you combine it with a home policy. This sort of policy can be renters insurance or home insurance. A traditional home policy, though, will often get you the most savings on your car insurance rate.

Boat insurance and RV insurance can also get you a multi-policy discount. Ask whether you can add these with the same provider where you get your auto and home insurance.

Some insurers offer more bundling options than others do. If you look hard enough, there are many ways to bundle. You may be able to get a multi-policy discount on snowmobile or ATV insurance, or even insurance on your golf cart or segway. 

The Bottom Line

Choosing an insurance provider and bundled insurance is not a marriage. It's a business relationship. The only things that matter are the coverage you receive, the service the business offers, and the premiums you’re paying.

If you have bundled insurance, your insurance provider still needs to meet your standards of coverage and service. If that isn't happening, start shopping around.

If you take the prices you find to your insurer, you might even find that it will be willing to offer you a better rate to keep your business.