As you make the transition from student to working adult, you begin to consider your finances. What are the best ways to save money for the future? How can I be proactive and responsible with my money?
One of the first expensive items that many people purchase is a car. Once you own a vehicle, you need to consider insurance. Many people may simply ask their parents or friends for ideas on where to purchase coverage without doing any additional research. This may be suitable for a short amount of time, but soon additional insurance considerations may become necessary.
As you advance in your job and relationships, you may consider other insurance protection such as home and life insurance. Your realtor may suggest a specific insurance company for your new house, while your employer might offer life insurance coverage. Suddenly, you have three different premiums with three separate bills each month. Wouldn’t it be easier and cheaper to find an insurance company that offers a bundling plan?
You may have heard the word “bundling” on TV commercials or in other ads, but are unsure of what it means exactly. Bundling is a way for you to have two or more of your insurance needs covered through a single provider. This is only offered through multi-line companies which offer different coverage options. However, there are many benefits to combining all of your insurance needs.
Benefits of Bundling
Think of how much easier it would be to have one insurance bill to pay instead of several. The ease to your household finances and management is reason enough to switch to a bundled policy. This is also beneficial if you have questions about your policies or want to re-evaluate your coverage. Speaking to a single insurance agent instead of scheduling several different meetings will ease the time you spend seeking answers.
If you don’t own a home, many insurance companies also offer a bundling option with renter’s insurance. According to Jeremy Bowler, senior director of global insurance practices at J.D. Power and Associates, the average renter bundles their insurance with their auto policy for a discounted rate.
In a study performed by Bankrate in 2014, researchers evaluated several of the top insurance companies and the type of discounts offered by each. The most popular discount offered was bundling. In fact, all of the major insurance carriers offer a bundling discount option. Therefore, you have almost a dozen companies to choose from when making the decision to switch. They are competing with one another for your business and often find it more profitable to offer you a discount for a multi-line policy than to continually find and process new customers. Therefore, the costs to you are very favorable.
Cost is one of the most important factors driving people to make decisions about their insurance needs. Research has shown that if you bundle your home and car insurance policies through a single company, you could save as much as 15 to 20 percent on your annual premiums.
For example, you may current spend $1,000 per year on your car insurance and $1,500 on home insurance in annual premiums. That’s a total of $2,500. If you were to bundle your coverage through a single carrier, you could save between $375 and $500 each year. That’s a lot of money that you can put toward other uses. If you add on a life insurance policy, you may see even more savings.
It is important to note that the amount of money you can save can vary based on your driving record, state of residence, credit score, and age. Additionally, you do not want to sacrifice the quality of your current insurance policy just to simply save a few bucks. Make sure that if you do bundle your policies that you continue to carry enough insurance to suit your current needs and then some.
You may also have a single deductible on your home and auto through bundling. In the event of a bad windstorm you might have damage to both you home and auto. A single deductible could result in large savings.
Steps to Bundling
Saving money with car and home insurance bundles is easy. First, speak to an individual insurance agent at a company that offers multi-line discounts. There are plenty of companies to choose from. They will have the knowledge and experience to help you create the best bundled insurance policy designed to suit your specific needs.
Ask for quotes separately for an auto and home insurance policy. Then, ask for a quote on the bundled price. This will help you to clearly identify the savings you will have at that particular insurance company. Make sure you receive these quotes directly from the insurance company and not online. Often, the quote generators on various websites are inaccurate, as they generally don’t ask you specific questions about your auto and home insurance needs.
Make sure to speak with your agent about the possibility of bundling other items too, like motorcycles, second cars, RVs, and boats.
Be careful in transferring policies from one company to another. The experts at the DMV recommend that you ensure that your new insurance carrier has started your policy and received your first premium payment before notifying your old carrier that you want to cancel. You do not want to be without auto insurance for any amount of time because your car will be vulnerable. With life insurance, it may be more difficult or even impossible to switch. The premiums may be different on a new, bundled policy because you are older and may have different medical issues that when you purchased your original coverage. Speaking with an insurance agent may help you to overcome these challenges.
According to Financial Web, more than 70 percent of home owners have a bundled policy with their auto coverage. These savvy consumers are more likely to stay with their multi-line insurance company for the ease and cost savings, as well as the fruitful long-term relationship they are able to establish with the insurer. So, why wait?
As stated by Investopedia, “Combining all of your policies with one insurance company can save you money compared to having a variety of carriers. It’s also important to remember, that when one company is handling all of your insurance policies, that’s less time that you must spend sorting through and paying each policy. And as they say: time is money.”
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Enhanced Insurance is not written by attorneys. If you’re looking for legal advice, you need to contact a lawyer. Further, insurance practices and forms change constantly and are varied from state to state. For definitive answers in your area, contact a local agent.
While the majority of people want an agent involved in their purchase of insurance, many people want to see if they can save money by buying direct from the insurance company. Others want to try a direct quote to make sure the premium they’re now paying through their local agent is fair. If you want a quote for your coverage, click on the competitive quote button on the right side of this page.