Bundling policies can offer a great deal on your insurance premium. Obtaining two or more policies from the same insurance provider can sometimes result in discounts of up to 25%. While it’s often true that getting two or more policies from the same company will mean savings, bundling may not always save you the most money. While using the same insurance company for both policies can be easier (and cheaper), it may not be the best option for every policyholder. Let’s examine some situations where bundling and not bundling insurance policies can help you save more money.
How bundling can save you money
Insurance companies that offer bundling tend to give a five to 15% discount on each policy. Homeowners’ insurance typically receives the most significant discount, as your home’s value is likely far greater than that of your car. Bundling your home and auto insurance policies typically makes the most sense if you’re paying a much higher home insurance premium than your car insurance. In any case, it pays to shop around to ensure you get the best deal for the coverage you require. Additionally, bundling typically provides the convenience of being billed by only one insurance company. Some providers may even require only a single deductible under a bundled policy if both your car and home are damaged in the same incident, such as a fire.
Advantages of bundling your insurance policies
When you bundle your insurance, you will have multiple insurance policies with the same company. Some advantages to bundling your insurance include:
- Receiving a better discount. You will pay less for all the protection you add to your policy.
- Dealing with one insurance company. Knowing who to call with questions, concerns, or if you need to file a claim, is reassuring.
- Combining your bills and payment statements. Make one easy payment. You’ll get one package in the mail and one payment schedule for both premiums.
- You can have a single deductible.
- You can more easily identify any coverage gaps.
- Bundle your policies, even if they have different renewal dates. You can add your second policy before renewal and lock in the quoted premium.
Advantages of not bundling insurance policies
“Bundle and save” is a common catchphrase used in the consumer world; everything from phone plans to hair products is sold in sets designed to bring you savings. However, it’s not always the most cost-effective way to choose insurance providers. There are pros and cons to bundling, and a lot depends on your situation.
However, there are several instances where bundling may not offer you savings:
1. Recent lifestyle changes
Exploring alternative discounts outside of bundling is an excellent idea if you have recently undergone a lifestyle change that may impact your insurance. For example, getting married (or divorced), having kids, or changing your commute may impact your insurance premiums. There may be an insurer out there that offers discounts for your particular lifestyle.
2. Reduction in coverage
Discounts associated with bundling your policies may seem desirable. However, always be sure to compare not only the price, but also the coverage included. Failing to do this may be a shock later on if you need to file a claim on your new policy. You may unknowingly sign up for a new policy with lesser coverage. When filing a claim, it can cost you more out-of-pocket. When bundling your policies, it is crucial to ensure that you retain the same level of coverage as before.
Your car premiums may be high for various reasons, including a poor driving record, collisions, speeding tickets, or a high-risk vehicle model. In this situation, you are better off shopping around for providers that offer the most affordable insurance, rather than bundling your home and auto policies together.
Some companies strive to build loyalty, so you’ll continue receiving a discount. Other companies will continue to offer you a “discount,” but may slowly raise the cost of your plans.
4. Convenience = complacency
Bundling all your insurance needs with one provider is convenient. After a while of having a policy with the same insurer, you may find that it no longer meets your and your family’s needs. Additionally, it is possible that even though you are still receiving a discount for bundling your services, your premiums may still be rising. In other words, this is beneficial for the company, but not so much for you. While the company may keep your business, they may no longer offer the best rate. If you want to save on auto insurance, please click here.
5. Affiliates
You may also find that the bundled plans you purchase aren’t offered through the same insurer. Some companies use affiliates. You will lose the ease of having only one company to work with. And if the affiliate relationship ends, you might need to shop around again or face a steep rate increase.
6. Compare quotes for bundled coverage
If you are considering shopping around for your car and/or home insurance policies, compare quotes for both bundled and separate policies. You may find that separate policies are cheaper than the bundled rate. Or, you might find that it’s substantially cheaper to bundle. It’s all about weighing the pros and cons.
7. Cost
Please make sure you research the cost of policies before exploring bundling discounts to maximize your savings. Finding more than one provider with the same coverage and lower prices may be possible. This research can result in a cost that is less than the total cost of a bundle with a different company.
Isn’t bundling insurance policies the right move?
Many will have you believe that bundling your policies will always save you the most money. But is this always the case? The short answer is – mainly, yes. Often, bundling your policies together with the same company can save you an average of 15% overall. Whether you’re adding multiple vehicles to an auto policy or combining your home, auto, cottage, RV, motorcycle, and/or life insurance policies, bundling has its advantages. However, bundling may not always be in your best interest, as there are several exceptions to the rule that can prevent you from obtaining the best deal on your coverage. If you have two significant policies with separate insurance providers, it may be in your best interest not to bundle.
At isure, we have access to many different insurance companies across Ontario. Your dedicated insurance broker can help you find the best policy and package to suit your specific insurance needs. Insurance companies offer various packages and discounts, which can be time-consuming to see if you search for a bundle on your own. With isure by your side, we’ll review all our Isure-approved insurers to find the best bundle offers at the lowest rates.
Speak with an isure broker today!
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