What happens if I need to cancel one policy?

Canceling either policy typically means losing the bundle discount on the remaining policy.

When you purchase a home and an auto insurance policy together, insurance companies often provide a bundle discount. This means you pay less for each policy compared to buying them separately. However, if you decide to cancel one of these policies, for example, canceling your car insurance while keeping your home insurance, you will typically lose that discount. This is because the discount is specifically designed for having both policies with the same insurer. Therefore, canceling one policy could lead to an increase in the premium for the remaining policy, as it no longer benefits from the bundled rate.

Imagine you have both your home and auto insurance bundled with the same company, enjoying a 10% discount on each. If you buy a new car and get a better insurance quote from a different provider, you might consider switching your auto insurance. However, once you cancel your auto policy with your current insurer, your home insurance will lose its 10% discount, and your premium costs might go up, making it important to weigh the total cost benefits when switching.

Before canceling one of your bundled policies, check the changes in your premium for the remaining policy to understand the financial impact. It might be beneficial to discuss options with your insurer; they may offer alternative discounts or solutions. Always compare the net savings of switching providers versus staying with your current one's bundle plan.