Bundling provides a discount when you purchase your home and auto insurance policies from the same company, but it is not always the cheapest option.

What are the benefits of bundling home and auto insurance?

Many insurers provide the option of bundling multiple products. Bundling your home and auto insurance together may be referred to as a multipolicy, multiline, or multiproduct discount. The benefits of bundling your home and auto insurance together may include:

Increased savings. Depending on the company and where you live, a multipolicy discount could save you anywhere from 5% to 25%.

Simplified policy management. When you get your policies from a single company, you should have less trouble managing them. If applicable, you'll work with a single agent and typically manage both your home and auto policies through the same web portal.

Insurance security. If you've filed auto insurance claims or received tickets, having other policies with the same company reduces the likelihood that your insurer will drop you.

Home and auto insurance bundles by company

Many car insurance companies offer bundling discounts, but how much you save depends on where you live and who insures you.

The table below lists the top ten auto insurance companies in terms of market share, all of which offer multipolicy discounts. In your state, not all companies or discounts may be available.

Should you bundle home and auto insurance?

Most companies do not limit bundling to just home and auto insurance, but instead offer a multipolicy discount break on a variety of policies with varying discounts. In most cases, larger policies receive steeper (percentage) discounts. Because homes are more valuable than cars, discounts on homeowners insurance are more common.

That means that if your home insurance is expensive and your auto insurance is cheap, bundling will probably save you the most money.

However, if you have a history of accidents or tickets, have poor credit, or live in a state with high car insurance rates, auto coverage may be the more expensive policy. In this case, the savings from going with the cheapest car insurance company may outweigh a 20% discount on a bundled home policy.

Compare quotes for separate policies and bundled policies to determine whether you should bundle home and auto insurance. There is no reason to purchase separate policies if the combined total is less than the bundled rate with one insurer.

Furthermore, bundling policies increases your likelihood of sticking with a single company. When you renew your policy, insurers frequently raise your rates, but not so much that you become dissatisfied and look elsewhere. This is known as price optimization, and it may result in you paying more for your policies than necessary over time.

Tips on better bundling

When bundling home and auto insurance, follow these steps to get the most bang for your buck (and avoid complications):

• Compare quotes for bundled policies from several insurers online or with an agent. An independent insurance agent can obtain quotes from a variety of insurance companies. Agents who only sell for one company can only offer discounts with that insurer.
• Check for third parties. Inquire whether the insurer uses a third-party insurance company (also known as an affiliate) for either policy. Although you may still save money, you will lose convenience because you will no longer be dealing with a single insurance company.
• Shop around regularly for quotes — both bundled and separate — on a regular basis to compare to the cost of your bundled home and auto policies.