Take Advantage of Homeowner Auto Insurance Discounts

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Written by Eric Schad Edited by Nick Versaw

Updated June 15th, 2023

Homeownership offers some major advantages. You can build equity and wealth, transform it into your own customized living space, or even get some peace of mind by knowing you always have a roof over your head. However, you may never have thought about how homeownership affects your car insurance policy.

By owning a home, you can typically take advantage of lower auto insurance rates, as well as reward yourself with a few extra discounts on top of that. Discover how homeowner auto insurance can put money in your pocket for doing nothing more than being the proud owner of a residence.

What is Homeowner Auto Insurance?

Homeowner auto insurance isn’t a specific type of car insurance or homeowners insurance policy per se; it’s a perk you get in the form of lower car insurance rates because you own a home. The basic idea is that because you’re a homeowner, you’re far less likely to file a car insurance claim.

Car insurance companies spend millions of dollars each year compiling statistics — and based on these analytics — homeownership routinely slots you into the lower-risk category. But rather than pocketing the money, car insurance companies pass along the savings to you as a way to entice new customers and retain current ones.

Is Bundling the Same as Homeowner Auto Insurance?

Bundling isn’t exactly the same as homeowner auto insurance, but the discount you receive only pertains to homeowners. When you bundle your home insurance and auto insurance, insurers will deduct a certain amount from your premiums.

A bundling discount isn’t necessarily confined only to home insurance policies and auto insurance policies either. Any type of multi-policy is also eligible for this discount, including insurance products such as:

• Motorcycle insurance
• RV insurance
• Boat insurance
• Life insurance or casualty insurance (through some companies)
• Renters insurance including personal belongings (if you didn’t own a home, you might still be eligible for bundling with renters and auto insurance)

On a positive note, most insurers don’t require you to have full coverage to take advantage of bundling. You could simply get a liability policy with property damage and bodily injury that only meets state minimum insurance requirements.

How Much Is a Homeowner Auto Insurance Discount?

As with any other car insurance coverage or discount, every insurance company offers its own specific rate for homeowner auto insurance. If you’re a homeowner, you’re guaranteed to get a cheaper rate than a renter — it’s one of the key factors that insurers use to determine car insurance rates for customers. Insurers are tight-lipped about how much this could impact your car insurance policy, but you could reasonably expect a discount of 2-4%.

Owning your home can also lead to substantial discounts when you bundle auto and home insurance. Again, the amount varies from company to company. According to a Forbes analysis, the amount you can save from bundling ranges from 6-23%, with an average savings of 14%.

Unlike some other types of discounts — such as a good student discount — you don’t have to request a bundling discount. The amount is automatically deducted from your bill each month.

How Do I Qualify for Homeowner Auto Insurance?

Qualifying for any type of homeowner auto insurance is surprisingly easy. You simply need to own a home. The type of home is almost inconsequential — you could own a house, duplex, townhome, condo, or apartment. The only kind of home that’s almost exclusively ruled out is a mobile home. Because you can technically move a mobile home, it’s not classified as traditional homeownership.

The only hoop you may have to jump through is proving that you own a home. Almost all insurers will ask for one or more of the following documents, so make sure to have them ready:

• Homeowners insurance declaration page
• Mortgage payment coupon
• Property tax bill or assessment

How to Qualify for Bundling Discounts

To qualify for a bundling or multi-policy discount, you just need to be a policyholder through a single insurance provider for more than one insurance product. In general, policy limits or the breadth of the coverage doesn’t matter.

For example, you could have a high-deductible homeowners policy coupled with liability coverage on your vehicle. Or you could have a low-deductible homeowners policy with flood insurance, as well as an auto insurance policy that includes additional coverage such as medical payments (MedPay), comprehensive coverage, and collision coverage.

Just remember that every insurance company has different eligibility requirements for various coverage options. Some may not offer bundling options at all, so do your research beforehand to ensure that it’s an option before you sign a contract for your home insurance coverage or auto insurance.

And regardless of what insurance product you want, getting either a homeowners insurance quote or an auto quote is always a smart idea.

The Pros and Cons of Bundling

As with any other type of insurance discount, bundling doesn’t guarantee a lower rate compared to other insurers and may have a few drawbacks. A glance at the pros and cons can ensure you make the right decision for your needs and finances.

Pros of Bundling

• Enjoy the possibility of having a sole deductible if both your car and home were damaged by a singular event, while also adequately protecting your personal property.
• Pay only one bill per month because you don’t have separate policies.
• Lower your additional living expenses via insurance by enjoying up to a 23% discount with the right insurance agency.
• Meet your lender’s auto and homeowners insurance coverage requirements with one insurance provider.
• You’re less likely to be dropped by a car insurance and home insurance company if you file multiple claims, as they would lose more business.

Cons of Bundling

• After getting car insurance and home insurance quotes, you may find that separate policies are cheaper.
• You may still have multiple policies if your bundling provider uses affiliates for coverage. For this reason, always talk to your insurance agent to ensure this isn’t the case.
• Some insurers will offer a bundling discount to entice you but will raise your rates, equating to a zero-sum scenario that offers little to no savings.

The Best Homeowner Discounts for Auto Insurance

Whether you own a home or you want to bundle products to meet your insurance needs, a vast majority of insurers now offer discounts to homeowners. It’s one of the many ways that insurers vie for your business.

Although the amount of bundling and homeowner auto insurance discounts vary by provider and change over time, here are some of the most competitive discounts on the market today (bundling only):

• State Farm: 23-25%
• Farmers: 18%
• Allstate: 15%
• Nationwide: 15%
• Travelers: 11%
• Progressive: 7%

Note: As mentioned before, you will automatically receive a 2-4% discount on your auto insurance by owning your home. However, you should always ask an insurance agent how much the discount is to get the best price when you’re shopping around.

Cash in on Savings Thanks to Your House

Whether you own a charming old Victorian or a modern beachside condo, saving money through your insurance can help you build equity or tackle that next home improvement project. But with so many different insurance companies out there, which one is the right choice?

The only way to know is by gathering quotes for your car insurance. By getting an idea of what your policy may cost and any associated discounts offered by each insurer, you never leave any money on the table.

In about the same time it takes to wipe your kitchen table, you can have multiple quotes at your fingertips. Clean house on car insurance overpayment by starting your search below:

Eric Schad Insurance Writer

Eric Schad has been an expert content writer for nearly a decade. Before getting behind the keyboard, he worked in the finance and music industries. With eight years of writing experience in the automotive and insurance industries, he enjoys communicating information that makes shopping for car insurance a breeze. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.