This article has been updated from a previous version.
Bundling insurance policies is not only convenient, it’s economical. Think about when you go grocery shopping and save a bit of money by buying more than one of the same product.
As extreme weather and the cost of building materials continue to challenge insurance companies’ profits, property insurance premiums are adjusted accordingly. If you’re on the hunt for a better deal, why not combine your auto and home insurance with the same provider?
An insurance bundle simply means that you buy multiple, yet different insurance policies from the same provider. Let’s take a look at the benefits of the most common pairing: home and auto insurance.
Benefits of bundling home and auto insurance
Logistically speaking, bundling home and auto insurance with the same provider can make it less of a nuisance to pay your annual premium because it’s going to only one company.
But the main perk of bundling is the savings. Insurance companies want your business and are willing to offer incentives to get you to sign up with them. When you bundle, you’ll receive discounted insurance rates, depending on your desired coverage levels, driving history, location, and other factors, like whether you own or rent.
The other benefit of bundling is that it simplifies the claims process. Should you need to make a home or auto insurance claim, you’ll be dealing with only one company.
Bundle your home and auto insurance, but customize each policy
You might be saving money by bundling, but you’re still taking out two distinct policies. It’s important to ask yourself whether each of the policies are right for your needs.
While the discount might be attractive, it’s still a good idea to read over each policy to make sure you’re getting the coverage you need for both your home and car.
Once you’ve signed up with an insurance company, it’s still a good idea to comparison shop for auto and home insurance every year. The bundle might get you a discount, but rates change all the time. People have a habit of sticking with their current insurance provider because it’s the easiest option. But comparing the market gives you an idea of what insurance bundles are out there, how much they’ll cost, and what they’ll cover. That way you won’t be stuck with a policy that no longer matches your needs or budget.
Bundle discounts are very tempting. Just be sure to read the fine print or talk to your broker before you sign anything. Discounts are great, but a suitable insurance policy for your personal property and vehicle is top priority.
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About the author
Renee Sylvestre-Williams is a finance and business reporter. In her more than 10 years of journalism, her work has been published in the Globe and Mail, Flare, Canadian Living, Canadian Business, the Toronto Star and Forbes. She also publishes a biweekly newsletter, The Budgette, where she provides financial education for single earners.