Are you struggling to keep your home and auto insurance costs in check without sacrificing the quality of your coverage? When you bundle your home and auto insurance policies, you may tap into a strategy to streamline your coverage and help you save money.

What is an insurance bundle?

Insurance bundling is simply purchasing more than one insurance policy with the same company. An insurance bundle will often include auto insurance together with homeowners insurance, renters or condo coverage. It can also include insurance covering your RV, boat, motorcycle or vacation home — if those policies are purchased from the same provider.

In fact, many insurance providers offer a discount in return for purchasing multiple policies from them. Note, too, that “bundling” discounts may be referred to by different names, including:

• Multiple policy discount
• Multi-policy discount
• Multi-line discount

Why bundle your home and auto insurance?

One of the most common reasons people choose to bundle insurance is to save money on their premiums. Insurance rates have been on the rise across the United States — a trend that is expected to continue for the foreseeable future. Bundling may be especially helpful in states such as Texas, where homeowners insurance premiums continue to be some of the highest in the nation¹, and auto insurance premiums² continue to climb, too.

Wondering why premiums continue to increase? Homebuilding and auto manufacturing costs are largely driven by materials, parts and labor. When those costs go up, so does the amount it would cost to repair or replace your home or vehicle. Higher insurance premiums typically follow this pattern, keeping pace with inflation. That cause-and-effect relationship helps fuel rate increases.

Discounts
Fortunately, there are ways to chip away at your premiums. With just one line of insurance, a provider’s premiums may not be competitive. But if you purchase multiple policies from one provider, they may offer a discount across all your bundled policies, giving you an overall cost savings.

Convenience
In addition to savings, bundling offers a convenient way to manage your policies. Having your insurance policies under one provider can simplify the business of keeping you, your family and your belongings safe.

Bundling can make it easier to:

• View and pay insurance premiums
• Review policies and coverage
• File, manage and track claims

There’s also less potential for confusion in your household about which carrier to contact should you need to file a claim. When and where available, bundling can provide one-stop service for your insurance needs.

Stability
Having multiple policies through the same carrier can swing the odds in your favor when life's little inconveniences occur (e.g., you make claims, get a speeding ticket, etc.). Insurance providers may be less likely to drop you³ due to any incidents. That’s because you’ve essentially given them repeat business by purchasing more than one policy from them. Over time, this shows loyalty and can help foster a relationship with your provider.

How much can you save by bundling?

The Texas Department of Insurance lists bundling as one of its tips for saving money on insurance.⁴ But how much you’ll save depends on the carrier, the policies you’re considering and other factors specific to you.

Unique factors for auto insurance include things like:

• Where you live
• How often you drive
• Your age
• Your driving record

Some carriers may also consider additional factors, such as your claims history or credit score, to determine your bundling discount. For homeowners insurance, these factors, including the size of your home, help determine your premium — as well as your home’s location and age, construction materials, presence of a security system and more.

When is the best time to bundle?

When would you like to try to save a little money? The advantages of bundling aren’t limited to a particular time or season. With that said, you should compare rates and ask about any bundling discounts any time you add a new policy to your existing coverage. You’ll want to work with an insurance agency to request a quote. This will help you determine what cost savings will apply to you and your insurance needs.

The same holds true when it’s time to renew your current insurance policy or policies. Many carriers reward loyalty with discounts, especially if you’re a long-standing customer or have multiple policies with them.

Certain events in your life can also present opportunities to save with bundling:

• Moving to a new area
• Purchasing a new home or vehicle
• Getting married, etc.

In general, if something in your life has changed or you’re simply exploring ways to save money, it’s probably a good time to consider bundling. A smart first step is to work with a reputable insurance agent to secure a quote. They can help determine if any cost savings will apply to you, given your factors and circumstances.

Already have a bundle or separate policies with a company?

You’ve likely asked for a second opinion from a doctor other than your primary care provider at some point in your life. That’s because having alternatives helps us compare our options and make informed decisions.

What happens if I cancel one of the policies in my bundle?

It’s possible that you could lose your discount, so it’s smart to talk with a licensed insurance agent before making any changes. They can help you understand the potential impact and may be able to offer alternatives that work better for you.

The takeaway

Combining all of your insurance policies with one insurance company may save you time and money compared to having a variety of carriers.

How much you’ll potentially save depends on a number of variables. Working with a reputable insurance provider who understands your needs and circumstances is the best way to determine if bundling makes sense for you.

RBFCU Insurance Agency can provide you with a policy review or you can request an online quote today.*