Life keeps getting more expensive, doesn’t it? In addition to higher prices on groceries, housing, and cars, Americans are also facing higher insurance bills. According to S&P Global, the average premium rate for homeowners coverage rose by 11.3% through December 2023. Some major auto insurers also raised rates by double digits last year.

Going without insurance is a terrible idea — plus, it’s illegal to drive without auto insurance in most states. And if you’re paying off a mortgage, your lender will require you to carry homeowners insurance. So how can we mitigate these increased costs? Personally, I’m bundling coverage this year.

Buying a home can also save money on auto insurance

I just became a homeowner, and I was pleased to learn that I would get cheaper coverage in exchange for bundling my new home’s policy with a policy for my car. This is a pretty common way to save money on insurance coverage. According to Progressive, consumers can save around 5% by bundling home, condo, or renters insurance with a car insurance policy.

In addition to the money savings, bundling might also make my life easier. If I have a problem with my car or my new home, I only have to call one number — and my insurer has local agents, so I can easily reach a human for help.

Other ways to save on insurance costs

You might assume that non-homeowners don’t have the option to bundle coverage in exchange for coverage and savings. Not so! Some auto insurers offer life insurance and other non-home coverage, so anyone who needs additional policies should explore bundling options.

And renters should have renters insurance — a landlord’s coverage will not cover a tenant’s belongings in the event of a claim on the property. I had this coverage bundled with my auto insurance for the last several years.

Here are a few more ways to save:

• Shop around: Different insurers have different rates, plain and simple. It’s a good idea to get at least a few quotes before signing on for a new policy.
• Ask about discounts: Many home and auto insurers offer a slate of discounts, such as for being a good student or a veteran. Sometimes discounts are available for paying the annual premium in full.
• Consider telematics: Drivers who are comfortable with being monitored by an insurer can look into telematics car insurance. Drivers download a mobile app or plug a device into their cars, and they can be rewarded with lower rates for safer driving.
• Boost credit scores: It’s unfortunate, but having a lower credit score can lead to higher insurance costs. The Motley Fool Ascent’s research team found that drivers with poor credit pay more than double what drivers with good credit pay for auto insurance. Consider paying all bills on time, having errors on credit reports removed, and paying down existing debt, if possible.

As insurance prices rise, it’s a wise idea to do whatever you can to save your budget. The road to becoming a homeowner hasn’t been a cheap one — but I’m glad that bundling home insurance with car insurance is giving me the chance to cut costs in at least one place.

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