Top States to Save on Auto and Homeowner's Insurance

NEW YORK (MainStreet) — Consumers can easily save an average of $270 per year by simply purchasing their auto and homeowner's insurance from the same company, which yields a 15% discount, according to a new insuranceQuotes.com report.

"Consolidating your insurance policies with a single company is one of the easiest ways to save money," said Laura Adams, senior analyst, insuranceQuotes.com. "The differences between states can be attributed to competitive and regulatory factors."

Owners who live in the South can save even more – the average savings in Louisiana is $505, while residents in Oklahoma can save $468, Texans can net $435 and those residing in Mississippi can save $422.

The lowest savings are in Hawaii where the average discount is $116, followed by Florida with $147, North Carolina with $166, Vermont with $176 and Idaho with $190. Click here to view the results for all 50 states and Washington, D.C.

"You can put the savings in a retirement account or for a vacation," she said.

 

The states with the highest discounts tend to have many natural disasters occurring, Adams said. When consumers combine their homeowner's insurance with an auto policy, it spreads the risk for the insurance companies to offer multiple products since most of the claims occur with cars, she said.

The average savings for combining car and condo insurance is 11% and consumers who bundle car and renter's insurance receive an average discount of 8%, the insuranceQuotes.com report said.

Consumers should still remain savvy and obtain quotes for each policy individually, Adams said. In some rare instances, you can get a better deal by purchasing policies separately depending on your occupation such as being a military member.

Statistics show that consumers who buy both auto and home insurance with the same company are much more likely to stick with that company for many years, said Mark Carrasquillo, broker with E.G. Bowman Company, an independent insurance agency in New York.

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"It's expensive for insurers to replace customers, so greater customer loyalty saves insurers money," he said.

Bundling homeowners and automobile insurance typically results in a discount on both policies of 5% to 15%, said Jim Fiske, vice president of Chubb Personal Insurance based in Warren, N.J. In New York, Chubb offers discounts of 10%.

Bundling auto and home insurance can result in consumers paying less in deductibles. If a resident backing his or her car out of the garage crashes into the garage door and both the home and car are damaged, the customer would only pay one deductible even though two insurance policies were impacted, he said. If the auto and home policies were with two different insurers, each one would charge a deductible. In the case of a wind storm, there is a good chance that a tree felled by the storm could damage both the house and the car. If the policies were bundled, only one deductible would be charged.

"Customers who bundle their coverage with one insurer have a better chance of getting insurance for other hard-to-insure risks," he said. "A customer may buy a vacation home along the coast in an area prone to hurricanes. If that customer has bundled his or her homeowners and automobile policies with one insurer and has a favorable claims history, it is more likely that their insurer will be willing to provide insurance for the vacation home, in spite of the exposure."

--Written by Ellen Chang for MainStreet

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