What’s the benefit of bundling your Oklahoma insurance? All you need is car insurance, right? That’s all you need. You have your home insurance somewhere else. Why do these insurance people insist on “bundling” all your policies?
Have you noticed the favorite “buzz-word” used by insurance companies in almost every television commercial is “bundling”?
Bundle your home and auto insurance!
Professor Burke, Flo, the lizard, even Chris Paul and Payton Manning are pushing it.
What are they talking about?
Let’s go to the dictionary, shall we?
verb, gerund or present participle: bundling; noun: bundling
to tie or roll up (a number of things) together as though into a parcel
to sleep fully clothed with another person, particularly during courtship, as a former local custom in New England and Wales
(example: “he would dance at country frolics and bundle with the Yankee lasses”
Definition 2 sounds more interesting, but let’s go with definition number 1.
When it comes to insurance, bundling means buying two or more insurance products with the same company. That’s usually going to be car insurance and either your home insurance, or maybe a renter’s insurance policy.
Why would bundling your insurance matter to you?
You will save money!
Saving money is a great motivator when it comes to insurance. After all, insurance is a large part of everyone’s budget.
The average bundle discount (referred to as a Mult-Line Discount in the Insurance biz) is 20%.
Let’s do the math. Say the average annual premium for the typical Oklahoma family with 2 cars and 1 house is $3000 per year.
If they split the car and home insurance between two different companies, they would likely pay in the neighborhood of $3,750 per year! So, they are saving $750 per year by bundling their home and car insurance with the same company.
$750 per year may not change your financial life, but that extra money can be used on other expenses, or how about building up your savings account, or adding to your retirement plan with the windfall?
2. How about convenience?
Is convenience ever a bad thing?
The most common apology is: “I’m sorry for the inconvenience”. I’ve never heard anyone complain about being “convenienced.”
Working with one insurance company, particularly one insurance agency, should be convenient. That doesn’t always mean the office is down the street from your house. Although, that would be convenient.
Convenience in the 21st century means, the insurance company and insurance agency is AVAILABLE WHEN IT’S CONVENIENT FOR YOU!
Would you like access to your insurance policy, billing account, and claims support by:
Going to your agent’s office?
Being able to call and speak to someone about your policy 24/7?
Being able to access your insurance online?
All of these things are made more convenient when all of your insurance policies are with one company.
3. You will have a more familiar customer experience across the lines of insurance with the same company.
This may sound trivial, but if the agency and company are committed to providing a great customer experience, you should have a better understanding of the products and service you are paying for along with more confidence in the people providing it to you.
The billing statements look the same, and you’ll have one phone number or point of contact.
When these things are confusing, you will quickly forget that you may be saving a few buck by keeping all your policies with different companies.
4. You will have a better working relationship with your insurance agent.
Having your car, home, boat, and life insurance all with different companies is like dating multiple people at the same time. ( I wouldn’t recommend it.)
Each company has advantages and disadvantages. But when you’re “dating” multiple companies, your relationship with any one of them will likely be shallow, at best.
If you have one insurance agency that you work with, they should be able to provide better advice since they have a more complete picture of your risks and the role you need your insurance to play in protecting your financial life.
This could be with a single company agency or even an independent insurance agency. The point here is, this business relationship is an important one.
5. What about when you have a claim?
Everyone assumes they will get price-punched by their insurance company if they file a claim. Claim behavior can certainly impact your insurance, but an automatic rate increase because of a claim is painting with a pretty broad brush.
But, the more you give an insurance company to protect, the more patient that company will be when it comes to your claims behavior.
It is less likely for a company to non-renew your insurance policy due to claims when you have multiple lines of business with the same company.
Sounds like a fairy tale, right. One company or insurance agency can help you with all of your insurance needs…and they all lived happily ever after.
…not so fast.
Not every company offers insurance for every insurance need a person may have. This is why working with an insurance agent is helpful.
The Allen Drew Insurance Agency with Farmers Insurance can help with every “typical” insurance need, such as:
We can also help with more important, though less typical insurance needs like:
Workers Compensation insurance
Having a relationship with an insurance professional when building a plan to protect the business that you pour your blood, sweat, and tears into is just as important as the relationship you will have with your CPA.
Protecting the financial future of your family is the greatest obligation an insurance agent has.
Helping you protect your greatest financial asset (your income) is part of the insurance bundle that gets overlooked, if not outright ignored. If your insurance agency is not asking you about your life insurance plan, take that as a big red flag.
Why do Insurance Companies want you to bundle your policies? What’s in it for them?
*Spoiler-Alert* Insurance companies are “For-Profit” enterprises. They don’t make offers with the goal of losing money.
In a JD Power and Associates study, customers with multiple lines of insurance with one company RENEWED their policies 78% of the time, versus 28% of the time for customers with only a single line of insurance. Although you are paying less, they keep your business longer.
Offering discounts is a smart business decision if it will mean a greater likelihood of repeat buying behavior, right? Long-term customers are the most valuable asset an insurance company has. So, they will cater to the customers they have a deeper relationship with.
Here’s the rub…
Having multiple lines of insurance with any insurance company can have ONE SIGNIFICANT DRAWBACK.
When there is nothing left to sell to you, you may become taken for granted.
Yep, I said it.
That’s true in any relationship, isn’t it? The more you know someone, the longer the relationship goes on, the more likely it is that we let things get stagnant.
Insurance is rarely a “get-it-and-forget-it” event. No relationship is.
As your life changes, your risks change too. These changes are often gradual. You may not notice some of them.
Your insurance company or agent won’t notice it either if they are not making an effort to keep up with your life and nurture that insurance relationship.
Bundling your insurance with one company or agency has a great benefit of helping you get a better price on your insurance plan. Insurance commercials make it sound like this is the most important reason for bundling.
IT’S NOT. At least it shouldn’t be.
The Most Important Benefit of bundling your insurance with one company or agency is the relationship.
That relationship can provide you with great advice through every phase of life.
That relationship will help you get through the anxiety and disruption when you need to file a claim.
That relationship will bring you peace of mind regarding the protection of your assets and income.
We at the Allen Drew Insurance Agency would like to extend an offer to review your current insurance plan. Our motto is: “We don’t just sell insurance, we educate.” We’ll start there.
If we are a good fit for you and your family, we would welcome the chance to work for you.
Enter some basic contact information below and we’ll reach out to you to start our conversation.
Better yet, give us a call at 405-340-0606. We are looking forward to visiting with you!