Happy late 4th of July to everyone. I hope you were able to dodge some of the rainstorms we got here in Wisconsin.
Just wanted to take a moment to discuss the term bundling. In the insurance world, it refers to when a customer adds more than one type of coverage to their plan under the same carrier. This helps enhance your overall coverage and provide you with the best price. You’ve probably seen this term used frequently in television ads and I wanted to give you an idea of why.
As our insurance carriers become more sophisticated through new technology, they can measure more factors to try and determine which customers are likely to file claims. The data would suggest that one of the biggest positives for the carriers is having more than one line of business. They have determined that customers with multiple policies are not only less likely to file a claim, but more likely to continue to do business with them. It all makes logical sense in a way but here’s what might not to those of us who aren’t well versed in insurance. We are seeing property and auto insurance rates that are 20-30% higher if they do not have bundled policies. This means in extreme situations we might see home or auto rates go from $700 to $1,000 simply because another policy is not written with the same carrier.
There are a few things to take away from this discussion. If you have home and auto insurance with the same carrier, you are on your way to making sure that you’re getting the best pricing available from carriers. If you do currently have two different carriers, it is worth looking into bundling your plans together. As mentioned, the carriers are offering their clients significant discounts for holding multiple policies and you’ll probably end up getting the most bang for your buck this way.
An additional thing to keep in mind is that carriers usually offer better products to those customers who have more coverage. One situation that would apply here is if a carrier is offering a policy for auto and home that has one deductible. For example, if a hail storm rolls through and your car and the roof on your home are damaged, many policies that are bundled have the client pay only one deductible. If you have separate policies, you might have a $1000 deductible for the auto AND another $1,000 for the home.
Finally, you should always check with your agent because we might be able to create a bundle and offer you coverage at a very discounted rate. The example we see most often here is someone who has an auto policy and rents, but does not carry a renter’s policy to cover their personal belongings and liability. Often times if we can create a bundle where the auto rate will drop to a point where we can add $20-30,000 of personal property coverage and liability for less than $50 per year.
As always, call your agent with any questions.
Thanks again for your partnership to protect your families.