By: Ramu Garuda July, 29, 2019
According to a Gavop study, Illinois’ homeowners can reduce their insurance costs by bundling their home and auto insurance. Bundling car and home insurance with the same insurance provider can help homeowners save $76-$114 on average. Most insurance firms offer discounts to customers who insure more than one vehicle with them.
Homeowners can also bundle their homeowners insurance with their life, business, and boat insurance provided by the same insurance firm. It is advisable that homeowners speak to their insurance providers about potential bundling options. Multi-vehicle discounts on bundling are also available for trucks, sports vehicles, and RVs.
However, in some cases, it is cheaper to buy insurance from different companies than bundling home and auto insurance with the same company. Companies use different parameters to calculate insurance rates such as age, location, marital status, and driving record. A company offering the cheapest rates for home insurance premiums may not provide the cheapest rates for auto insurance.
For example, assume State Farm charges homeowners $1,000 for auto insurance and $1,000 for home insurance and offers a $200 discount on bundling, whereas Progressive offers a homeowner insurance at $690.
Bundling with State Farm costs insurance buyers $1,800 after the discount, whereas they can purchase a home insurance policy for $700 from Progressive. In this case, buyers can reduce their insurance costs by opting for State Farm’s auto insurance and Progressive’s home insurance.
Insurance firms consider customers who bundle their insurance policies to be more valuable and therefore, the firm is more likely to renew the coverage after an accident or a claim. Regular non-payments of insurance premiums, however, can cause an insurance provider to increase the premium rates.
Ramu is a research analyst with over 9 years of analytics & research experience. Prior to joining the company, he worked with some of the prominent consulting and market research firms in India, including Pride Technology (Supporting consulting projects to PWC), RR Donnelly, and The Hackett Group. His skills include company profiling, benchmarking, data and trend analysis, industry analysis, and report writing across the industries. Ramu holds a Master’s degree in Finance and Marketing. He also has a bachelor’s degree in Biotechnology.