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"Bundle your insurance" is one of those savings tips found in almost every insurance article online. It's a good one too. I'm using it right now to save on my car insurance.
But it's not as straightforward as it first seems. Interestingly, it could actually cost you more. Insurers offer renters and auto insurance bundle discounts in the first place so that you'll give them more money, but in some cases, it would still be cheaper with other companies.
There are some other things to consider before limiting yourself to the company offering the highest bundling discount.
Key takeaways
- Insurers often offer multi-policy discounts ranging from 5% to 30% for renters and auto insurance bundles.
- Managing bundled renters and auto insurance is easier when you're only working with one company and paying a combined bill.
- Bundling your policies can yield big discounts, but you can sometimes save even more by buying policies separately elsewhere.
- Rather than just looking at individual discounts, always consider the total cost of your premiums when comparing rates.
How does insurance bundling work?
You're familiar with seeing sale signs at the store, like "Buy X items, get Y% off." An insurance company offering a renters and auto insurance bundle discount is essentially the same thing. Buy two or more policies and get cheaper car insurance coverage with a bundling discount.
The way insurance companies apply those discounts can sometimes be tricky. When you get your bill, for example, one policy might appear at full price while the other one gets a discount. That can make it tricky to compare rates across companies, so it's best to focus on the total amount you'd pay to insure yourself, even if you split your policies among companies.
Some companies also pass on savings in other ways, such as only charging one deductible if you need to file claims against both your auto and your renters insurance at the same time. That's how my car insurance policy is set up — I have a $2,500 deductible for my home insurance (a similar policy to renters insurance) and a $500 deductible for comprehensive and collision car insurance.
I'd need to pay the deductible for each policy separately if I filed a claim on just one of them. But if a wildfire rolls through my town and burns down my car and all my other worldly possessions, I only need to pay the higher deductible. So, instead of paying $3,000, I pay $2,500 and save $500. For many people, paying just one deductible can be a lifesaver during an already stressful time.
Typical savings with a renters and auto insurance bundle
Not all companies offer multiple types of insurance policies. But if they do, there's a good bet they'll offer a discount to woo you into buying another policy type. Here are the maximum combined auto and renters insurance discounts that some popular insurance companies offer.
| Insurance company | Maximum advertised bundling discount |
| Amica | 30% |
| Direct Auto | 10% |
| Erie Insurance | 15% |
| Progressive | 5% (on average) |
| Travelers | 5% |
| USAA | 10% |
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Should you bundle your policies for a discount?
Opting for a renters and auto insurance bundle from the same insurer can be a good strategy, but it ultimately depends on your goals.
Do you want to save as much money as possible, get exactly the right coverage, receive the best customer service possible when you file a claim, or simplify your finances?
These are all separate goals that you may or may not get by bundling policies through one insurance company instead of buying them from separate companies. Think about these pros and cons first.
Pros
- Potential for big savings: Some companies advertise that you can save up to 30% on a renters and auto insurance bundle. That's huge! Plus, single-deductible claims across multiple policies can save you a lot of money in an emergency.
- Simplified insurance: Keeping all of your insurance with the same company and on the same payment schedule makes things much simpler to manage. The younger version of myself could barely keep her shoes tied, and simple policy management was a very helpful feature.
Average rate:
Cons
- Diversification: Insurers can — and have — gone out of business, especially during natural disasters when many people file claims at once. Sticking with one insurer increases that risk, especially if your chosen company has a low financial stability rating.
- Not always cheaper: Let's say Insurer A offers a 15% bundling discount. That's nice, but what if separate policies from Insurers B and C already cost 30% less on their own? The base prices and discounts can vary widely among insurers, meaning you can often save even more by shopping around.
- Limited policy options: While the basic coverage types are relatively standard among insurers, each company also offers distinct products, coverage options, and features that you might miss out on by shoehorning yourself with one insurer.
- Difficulties shopping around later: I'll admit it. Despite telling people to get quotes and shop around each time their policy is up for renewal, I don't think I've done so myself since 2015. I rely on my bundling discount to console me into laziness, and I know I could save more elsewhere. My insurer doesn't mind.
How to bundle your auto and renters coverage
If you decide that bundling your policies together is the right move for you, here's how to do it.
Staying with your current insurer
Assuming your current insurer offers the type of new policy you're interested in, the purchase process is often as simple as logging into your online account or contacting your insurance agent.
Keep in mind that you may need specific information. For example, to buy an auto policy, you'll need your car's make, model, vehicle identification number (VIN), etc.
Getting coverage through a new insurer
If you're buying a bundled policy from a new-to-you insurance company, make sure you get quotes before your current policy expires, since some companies offer an extra discount for this. Once your new policy is in place, feel free to cancel the old policy. You may qualify for a refund of any prepaid premiums from your old insurer.
More ways to lower your insurance costs
Bundling policies — or buying cheap policies separately — isn't the only way to save money on car insurance. Here are a few other options.
- Drive safely: By driving safely, you can avoid rate-raising accidents and costly deductibles for claims. Some insurers offer claims-free discounts too.
- Work on your credit: In many states, insurers can use your credit report when calculating your insurance costs.
- Check for discounts: Call your insurance agent. They may not be open to negotiating your rates, but they may be able to do a quick check that you're getting all the discounts you're due.
- Revisit your coverages: Again, check with your insurance agent to see if you can drop any coverages you no longer need. You can also reconsider your coverage limits.
- Opt for higher deductibles: Opting for a higher deductible usually means paying a lower premium. Just make sure you can afford the deductible. (Pro tip: Stash it in a high-yield savings account.)
- Use your insurer's telematics program: Many insurers offer an app or device that you install in your car to track your driving, providing custom feedback on your driving habits and potentially big discounts in the process. (Rates can go up for bad drivers, though.)
FAQs
Is it cheaper to bundle auto and renters insurance?
Most insurance companies offer a discount of 5% to 30% if you buy a renters and auto insurance bundle. That said, it may still be cheaper to buy separate policies from two different companies. The only way to find out is to get custom quotes from different insurers.
What is the best auto and renters insurance?
Erie and Amica ranked as the top renters insurance companies for customer satisfaction according to the 2024 J.D. Power U.S. Home Insurance Study. These two insurers were also ranked as some of the best car insurance companies in many of the regional markets that J.D. Power examined in the same year.
Does GEICO bundle renters and auto?
Yes, GEICO offers a renters and auto insurance bundle discount, but it doesn't advertise the amount. It also extends its bundling discount to other types of policies, like RV or motorcycle insurance.
Bottom line
Buying a car and renters insurance bundle from the same insurance company definitely streamlines your finances, and it could help you score a good discount. But will it help you actually save money in the long run? Maybe — but not always.
The only way to tell is to get quotes from other insurers. Each company charges different policy prices depending on your individual factors, applicable discounts, and optional add-ons. That's tougher to compare than a simple "save X% by bundling!" claim, and insurance companies are betting you won't do the work to shop around (as I know all too well myself). As they say, do as I say, and not as I do.
The next time your insurance policy is up for renewal, spend just a few minutes shopping around to get and compare quotes for insurance policies from different companies — give our list of the best car insurance companies a look for some options.
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