With insurance commercials continuously running on TV and radio, you probably experience at least one pitch for coverage every day. Some advertise low rates on individual policies while others advertise that you can bundle several policies to save. So how do you know which path is right for you? Continue reading to learn more about the differences between bundled and à la carte insurance policies and how the choice you make could cost – or save – you hundreds every year.
Bundled Insurance Defined
When you bundle your insurance, you are choosing to purchase more than one line of insurance coverage from the same insurance provider. Most often, this is home and auto insurance, although it could include your renters insurance, condo insurance or townhome insurance instead. Some people even add additional policies, such as small business insurance or coverage for a recreational vehicle.
Some insurance companies go a step further, offering a lesser known insurance product known as ‘package insurance.’ With an insurance package, several types of coverage are bundled into a single policy with one straightforward, discounted premium to pay. Package insurance can save time and money – especially when it comes time to make a claim. Since all assets and liabilities are covered under the same policy, there is no need to file multiple claims or pay two deductibles a tree falls on your house and car. Furthermore, a package policy can translate into a more streamlined claims process involving only one insurance company and one agent.
The Big Myth Surrounding Individual Policies
If you have more than one asset to insure, such as a house and a couple of vehicles, you may have considered ‘outsmarting’ the system by shopping around for each type of coverage independently from one another. While this bare bones approach to comparison shopping may seem like the smart approach, it can backfire, potentially robbing you of savings.
For example, imagine that you shop for your homeowners insurance first. You receive a quote of $700 per year, which is near what the average Arizona homeowner paid for coverage in 2012. When you shop for auto insurance, the same insurer quotes a rate that is $10 more per month than the lowest quote available. You assume that by taking the lowest quote, you receive the same great coverage and save $120 per year.
However, you may not have taken into account the discount for bundling your policies. According to the average driver in Arizona saves $243 on premiums simply by purchasing coverage through the same company. With average insurance savings of 5 to 15 percent, it pays to compare prices for both individual and bundled policies.
When it comes to shopping for car and home insurance, don’t do it alone. For more than 20 years, Mooney Insurance Agency has been helping homeowners and drivers in the Tucson area find the house and auto insurance solutions that meet their needs. Whether that is purchasing individual policies from multiple insurance companies, or bundling coverage for a better deal, we work on behalf of our customers to find complete, quality insurance at the most competitive rates.