If you own or lease an automobile, and unless you live in New Hampshire, you’re required to have auto insurance. According to the Census Bureau, in 2014, 37% of Americans rented their homes–an increase from 34.1% in 2009–while a study conducted by Trulia concludes that 43% of Americans rent their home. A 2016 Insurance Information Institute poll found that only 41% of renters have insurance. If you don’t currently have renters insurance, consider getting it. According to the Insurance Information Institute, the average cost in 2014 was $190 per year. Renters insurance typically provides coverage for lost, stolen, or damaged possessions, and may provide coverages for injuries and lawsuits should an injury to another person happen in your rented home.
If you already have renters insurance or plan on getting a policy, consider bundling it with your auto insurance as you may qualify for a discount. Bundling could be as simple as a phone call to your current carrier and adding renters insurance to your policy. Most larger auto insurance carriers offer renters insurance and discounts generally range from 3% to 10%. Some smaller insurance companies may not offer multiple lines, but it’s worth your time to speak with an agent.
Along with savings, bundling policies also offers the convenience of both policies being on the same bill. Additionally, it may help to foster loyalty with your carrier, which could be valuable if your carrier were to consider dropping you as a customer if you experienced a string of losses and/or claims.
However, bundling may not make the most financial sense for you. Depending on your state, the population of your city, and various other factors, what one carrier might offer in one region, that same carrier’s premiums may be more expensive in another region. It may be cheaper to purchase auto and renters insurance with different carriers.
Should you decide to bundle your renters insurance with your auto insurance, there’s a couple of things to keep in mind. First, you’ll want to check if there’s a cancellation fee. If this outweighs the savings in bundling, you may want to wait until your policy renewal period.
Secondly, you’ll want to avoid a gap in coverage for both your auto and renters insurance. If you’re going to switch policies to a new carrier, you’ll want to notify your current carrier and find out exactly what date & time your current policy will expire in relation to when your new policy will take effect. If you have a gap in auto insurance, this could result in a premium increase as you’d technically be uninsured for a period of time and your carrier will report this to the DMV, which could leave you open to fines and/or other penalties. If you drive without insurance, you could be liable for any damages or injuries in the event of a car accident. Similarly, if you were to allow your renters insurance to lapse, you wouldn’t be covered in the event of a loss.
While bundling your renters insurance with your auto insurance offers potential discounts as well as other benefits, you’ll still want to do your research and compare quotes to determine if bundling savings will be significant enough for you to make the switch. A recent survey found that 39% of Americans never shop for a better rate, simply allowing their policy to renew year after year and potentially missing out on savings. We recommend getting quotes from at least three to five carriers to get a better idea if bundling renters insurance with auto insurance is right for you.