Articles
Auto-Home Insurance Bundling
Every new homeowner quickly discovers that hazard insurance is a requirement, not just for peace of mind, but in order to meet the terms set by the mortgage company. While almost every mortgage company would be delighted to sell you their in-house insurance, this is extremely expensive. Hazard insurance may be required, but paying an arm and a leg for it is not.
To find the best rate on hazard insurance, new homeowners should look to other insurance they already have: auto insurance. With rare exceptions, auto insurers also provide hazard insurance, and what new homeowners will learn very swiftly is that bundling, or combining your auto and home policies will save money. Significant money. In fact, combining home and auto coverage can net a total discount of 10 – 20%.
In addition to saving money, there are several other reasons to considering bundling your hazard and auto coverage with the same carrier:
- Loyalty Discounts: In addition to the automatic savings you'll get from bundling your auto and home insurance, many companies also give discounts for loyal customers – those who have maintained active policies for several years.
- Personal Relationships: Bundling enables you and your agent to get to know each other better, so you are more comfortable asking for changes, and they learn your needs, and can offer products that fit your lifestyle well.
- Convenience: One bill, one payment, one phone number to call in the event of an accident or claim.
- Further discounts, when you add other products, like life insurance, to your total portfolio.
It is, of course, important to remember that insurance rates are based on risk. Depending on where you live, and the size and value of your home, as well as what you drive, you may find that you pay more than the average for auto insurance, but that your hazard insurance is lower, or vice versa. For this reason, it's never a bad idea to shop around for pricing on both types of coverage. While your existing auto insurer is probably fine, you may reap the "new customer" benefits (discounts that are only offered to new policy holders) at a different company.
Additionally, it's vital to consider the stability of the insurance company you choose. After all, even the cheapest policy is worth nothing if the company that wrote it is unable to provide good service, or has difficulty paying claims.
