Speed Reads:
- Bundling your home and auto insurance can save you money and time, and lower your risk of being dropped by your insurer.
- Bundling your insurance isn’t always the cheapest option, and you need to watch for premiums that creep up over time.
- If you’re looking to bundle your home and auto insurance, we suggest starting your research with State Farm, USAA, and Geico.
Most insurance companies will offer consumers a discount if you bundle your home and auto insurance together. But does it really save you money in the long run? In this article, we’ll take a closer look at the pros and cons of bundling your home and auto insurance, as well as the discounts you could receive from our top three providers.
Our team has spent over 1,950 hours researching and collecting data from dozens of insurance companies in order to rank the providers on their industry standing, availability, coverage, cost and discounts, customer service, and technology. Keep reading to learn more about bunding your home and auto insurance with the best car insurance companies on the market.
Why Do Providers Offer Home And Auto Insurance Bundles?
If you’re considering a home and car insurance bundle, you may wonder why insurance companies offer this option. While bundling your insurance can save you money, it can also help maintain revenue for your insurance provider. People who bundle their auto and home insurance policies often stay with their provider for longer. This helps insurance companies retain customers.
Insurance providers also save money on underwriting when you bundle. Insurance companies hire underwriters to research each new client to determine how much risk the customer presents. This process, called underwriting, includes looking into a customer’s credit history, driving record, employment history, and other factors. Since insurance companies complete underwriting for each new customer, they save money when they only have to complete this process once for multiple policies.
Pros Of Bundling Home And Auto Insurance
Take a closer look below at some pros to consider when deciding if you should bundle your home and auto insurance:
Cost Effective
If you bundle your auto and home policies, you’re likely to save money on insurance premiums. Most car insurance companies offer a variety of discounts, and you’ll be able to take advantage of the multi-policy discount if you choose to bundle.
Your exact discount will vary between insurance companies, but many offer a discount of at least 10 percent. In addition, some companies lower deductibles when you bundle, while others allow customers to combine deductibles in certain claims circumstances. For example, if a tree in your yard falls on your car, you may be able to lump all damages into one claim.
Saves You Time
Dealing with one company for all your insurance needs can save you time and hassle. If you choose an insurance company that works through local agents, you’ll only need to deal with one agent for everything when you bundle your policies.
In addition, when you bundle home and auto insurance policies, you will only need to download and learn one app. This also allows you to quickly check both policies and pay premiums from the same place.
Lowers Your Drop Risk
Insurance companies closely monitor your driving record and insurance claims to determine your financial risk. If you file too many claims or end up in multiple accidents, some insurance companies will drop you. However, when you bundle your car and home insurance, you become more valuable to an insurance company. Although you shouldn’t entirely rely on this, it could make an insurer less likely to drop you depending on your circumstances.
Cons Of Bundling Home And Auto Insurance
Although the bundling discount can be appealing, there can be some drawbacks to combining your insurance policies. Take a look at the cons of bundling a homeowners policy and auto insurance below:
Not Always Cheaper
Most insurance companies offer customers discounts when they bundle car and home insurance, but you may not receive the cheapest overall rate this way. Since some providers primarily focus on car insurance, they may not offer competitive rates on homeowners insurance. Personal factors, like your driving record or home location, can also lead to higher rates. We recommend that you obtain multiple home and auto insurance quotes before settling on one provider.
Premium Creeps Up Over Time
When customers bundle car and home insurance, they typically remain loyal for longer durations of time. Many customers who bundle renew their policies without comparing prices first. Insurance companies know this, and may sometimes increase premiums over time because they feel confident that they can keep your business.
If you decide to bundle your home and auto insurance, collect quotes any time your rate increases due to “pricing optimization.”
Third-Party Vendors
When purchasing a home and auto insurance bundle, most people assume that both policies will be handled by their chosen provider. However, some insurance companies work with affiliate companies to offer multi-policy plans, so you may not have your home and auto insurance under one roof.
Make sure to research who would be handling your policies if you choose to bundle with a certain provider.
Factors To Consider When Bundling Home And Auto Insurance
Many factors impact insurance rates, and the cheapest insurance isn’t always the best. It’s important to consider the following when obtaining home and auto insurance quotes:
- Home and car values: The value of these items can impact rates, discounts, and coverage needs.
- Location: Your physical location can affect both your car and home insurance rates. Some insurance companies will charge more in certain geographic regions.
- Coverage needs: Sometimes bundling discounts only apply to certain policies, and you could end up paying more for your policies while receiving less coverage.
- Cancellation or transfer fees: Some companies may charge fees for early termination or policy transfers, so read the fine print before making a switch to bundle your home and car insurance.
Our Home and Auto Insurance Methodology
As we compile ratings for auto insurers, we look at each provider’s strengths and weaknesses in six key categories. While our ratings are strictly based on a provider’s auto insurance offerings, we’ve done additional research on home and auto bundling discounts from the industry’s top providers. We put in the research so you can make an informed decision on whether bunding your insurance is right for you.
How We Rate Auto Insurance Providers
We refresh our review standards multiple times per year to keep our information current. Overall, our insurance research falls into six main categories: industry standing, availability, coverage, cost and discounts, customer service, and technology.
Industry Standing
We won’t recommend a provider unless it’s reputable, and we take into account an insurance provider’s industry standing as we conduct our research and determine ratings. Our team looks at how long it’s been in the industry, its Better Business Bureau (BBB) rating, AM Best Financial Strength rating, and more.
Availability
When rating a provider on availability, we consider whether it’s available nationwide or only in certain regions, as well as exclusions it might have in certain U.S. states. Some companies may only provide insurance to certain groups of people, and our ratings take this into account as well.
Coverage
We consider the various options offered by each auto insurance provider when rating them on coverage. We take into account add-ons such as roadside assistance, rental car reimbursement, and specialty insurance such as rideshare or guaranteed asset protection insurance policies. We also consider usage-based insurance apps in our overall coverage rating.
Cost And Discounts
Overall costs and available discounts are a large part of our score for a provider. If an insurer offers low average rates in addition to various ways to save money on an auto policy through discounts, it will likely score highly in this category.
Customer Service
We know how important it is to receive a great customer service when dealing with an insurer. We look at reviews, ratings, and complaints filed with companies like the BBB when rating an insurer on customer service. We also consider the latest J.D. Power Insurance studies in addition to our own collected survey data from insurance consumers.
Technology
Insurance apps are commonplace in the industry, and we score providers in this category on their mobile app downloads, reviews, and ease of use. We also consider if a provider offers a quick and easy online quote process to consumers, as well as their website speed.
Top Home And Auto Insurance Companies
The national average for a full-coverage auto insurance policy is $1,730 per year or $144 per month. Find more information below on our top three auto insurance providers and their costs, overall ratings, and the home and auto insurance discount they offer, so you can choose the best home and auto insurance bundle for your needs.
Each of the recommended providers below offers at least these six standard coverages options:
- Comprehensive insurance: This pays for damages to your vehicle that are the result of theft, weather, collision with an animal, or other damage your vehicle may incur while parked
- Collision insurance: This pays for damages to your vehicle after an at-fault accident or collision
- Bodily injury (BI) and property damage (PD) liability car insurance: For accidents you cause, BI insurance pays for medical expenses for injured persons, and PD coverage pays for damage to other vehicles and property
- Medical payments coverage (MedPay): This pays for medical expenses if you are injured in an accident
- Underinsured/uninsured motorist coverage: This pays for damages to your vehicle and medical expenses after an accident with an uninsured or underinsured driver
- Personal injury protection (PIP insurance): This pays for your medical expenses and other costs related to personal injury after an accident, such as lost wages
State Farm: Best Overall
State Farm has grown into a national leader for auto and home insurance needs, and the company’s reputation speaks for itself. State Farm has an A++ financial strength rating from AM Best, and a combination of online tools and local insurance agents make the customer experience great all around.
State Farm Quick Facts
Founded: 1922
Availability: 50 states, but no longer sells new policies in MA or RI
Market share: 16.89% in 2022
AM Best financial strength rating: A++
BBB rating: B
Bundle discount: Varies
How We Rated State Farm Auto Insurance
See below for our ratings out of a 5.0-point scale across six categories for State Farm auto insurance:
| Ratings Category | Score |
|---|---|
| Industry standing | 4.8 |
| Availability | 4.9 |
| Coverage | 4.6 |
| Costs and discounts | 4.6 |
| Customer service | 4.7 |
| Technology | 4.4 |
| Overall Score | 4.7 |
State Farm Home And Auto Insurance: Coverage And Costs
In addition to the standard car insurance coverages, State Farm offers specialty coverage such as car rental, travel expense, emergency road service, and rideshare coverage. The national average cost for full-coverage auto insurance with State Farm is $1,481 per year or $123 per month. Go more in-depth on all that State Farm offers in our State Farm auto insurance review.
If you’re looking to bundle your home and auto insurance with State Farm, it offers coverage that can protect your home, garden, keepsakes, and more. State Farm claims that its policyholders who bundle their insurance save on average $1,127 per year. However, keep in mind that your individual discount will vary. If you rent instead of own your home, you can also bundle auto and renters insurance with State Farm.
See the infographic below for information about customer satisfaction with State Farm policyholders from our latest car insurance consumer survey:
USAA: Best For Military
If you’re eligible for car insurance through USAA, the company’s low auto insurance rates and savings of up to 10% make it a great choice for bundling home and auto insurance. USAA has a strong AM Best financial strength rating and is available in all 50 states. However, its home and auto insurance policies are only available to military members, veterans, and their families.
USAA Quick Facts
Founded: 1922
Availability: 50 states
Market share: 5.94% in 2022
AM Best financial strength rating: A++
BBB rating: Not rated
Bundle discount: Up to 10%
How We Rated USAA Auto Insurance
See below for our ratings across six categories for USAA auto insurance:
| Ratings Category | Score |
|---|---|
| Industry standing | 4.8 |
| Availability | 3.5 |
| Coverage | 4.7 |
| Costs and discounts | 5.0 |
| Customer service | 4.6 |
| Technology | 4.7 |
| Overall Score | 4.6 |
USAA Home And Auto Insurance: Coverage And Costs
USAA offers the usual standard car insurance options to consumers, in addition to specialty coverages such as accident forgiveness, rideshare insurance, and classic car insurance. The national average cost of a full-coverage auto insurance policy with USAA is $1,054 per year or $88 per month. If you’d like to learn more about USAA’s car insurance coverage, check out our USAA auto insurance review.
If bundling your home and auto insurance with USAA sounds appealing to you, home insurance offered by USAA includes coverage for personal belongings, personal liability coverage, earthquakes, home sharing, loss-of-use, dwelling, and other coverage options. USAA also allows you to bundle other types of insurance, like auto and life insurance.
See the infographic below for information about USAA policyholder customer satisfaction from our latest car insurance consumer survey:
Geico: Best Discount Availability
As one of the largest car insurance providers in the nation, Geico is highly rated by industry experts. It has an A+ rating from the Better Business Bureau (BBB) and an A++ rating in financial strength from AM Best. In addition, J.D. Power consistently awards Geico with a high score for customer satisfaction.
Geico Quick Facts
Founded: 1939
Availability: 50 states
Market share: 13.8% in 2022
AM Best financial strength rating: A++
BBB rating: A+
Bundle discount: Varies
How We Rated Geico Auto Insurance
See below for our ratings across six categories for Geico auto insurance:
| Ratings Category | Score |
|---|---|
| Industry standing | 4.9 |
| Availability | 5.0 |
| Coverage | 4.2 |
| Costs and discounts | 4.6 |
| Customer service | 4.4 |
| Technology | 4.5 |
| Overall Score | 4.6 |
Geico Home And Auto Insurance: Coverage And Costs
Geico offers the standard car insurance options, as well as roadside assistance, rental reimbursement, and mechanical breakdown insurance. The national average cost of a full-coverage auto policy with Geico is $1,308 per year or $109 per month. If you’d like an in-depth review of Geico’s auto insurance coverage, read our Geico auto insurance review.
Home insurance products offered by Geico include property damage, personal property, personal liability, medical bills, and living expenses coverage. Your home and auto insurance bundle discount with this provider will vary based on different factors, but you’ll likely secure a better discount if you’re already a customer.
See the infographic below for information about customer satisfaction from Geico policyholders, which we obtained through our latest car insurance consumer survey:
How Do I Bundle Home And Auto Insurance?
Bundling your car and home insurance is a relatively simple process. Once you compare quotes from multiple insurance companies, contact the company of your choice to start the application process. An agent will typically ask you if you’d like to bundle home and auto insurance. If they don’t, mention this early in the process.
If you’re switching insurance companies, be sure to research your state’s car insurance laws and ask your new insurance company when you should cancel old policies. In addition, ask about any cancellation or transfer fees if you are ending your previous insurance policy early.
Home And Auto Insurance: Conclusion
Given the discounts, time saved, and lower drop risk, combining home and auto insurance makes sense for many people. However, there are some cases when it isn’t in a customer’s best interest or isn’t the cheapest car insurance option. Always shop around and research companies carefully before making the decision to bundle your home and car insurance.