Why Your Car Insurance Directly Affects Your Home Insurance

Most homeowners view their car and home insurance as completely separate things—different risks, different premiums. But the truth is, these two policies are deeply connected. Understanding this link is essential for every homeowner looking to save money, avoid penalties, and secure the best coverage.

At Cal-Society Insurance Services, we want you to know how your auto policy can directly influence your home insurance rates and eligibility.

5 Ways Your Auto Insurance Impacts Your Home Policy

Your insurance company assesses your risk as a whole, not just one policy at a time. Here are the key factors that link your car and home coverage:

Your Overall Risk Profile 🚩 Insurance companies evaluate your overall risk as a customer. If your auto history shows frequent claims, traffic violations, or coverage gaps, insurers may view you as a higher risk across the board. This can signal potential risk for your home policy, resulting in a higher home insurance premium.

The Power of Bundling Discounts 🤝 You likely bundle your policies for savings, but remember, bundling works both ways. If you decide to switch your car insurance carrier or your auto rate increases due to a bad driving record, you could lose the valuable multi-policy discount on your home insurance, causing that premium to jump up.

Credit-Based Insurance Score 💳 In many states, both auto and home insurers use a credit-based insurance score to help determine rates. Issues with your auto policy—like missing or late premium payments—can lower this score, negatively affecting the rate you are offered for your home insurance as well.

Claims History and Higher Risk 📉 While a fender-bender is different from a burst pipe, a long track record of auto claims can brand you as a «higher-risk customer». This can lead to your home insurer reducing your available discounts, increasing your home premium, or potentially limiting your coverage options.

Auto Liability Hints at Home Liability 🏡 This often surprises people: if you have a history of at-fault auto liability claims, an insurer might infer that you have a higher potential for home liability issues (like a guest injury). This could lead to a higher home liability premium or increased deductibles on your home policy.

Simple Steps to Keep BOTH Rates Low

To maintain the lowest possible premiums for your car and home, focus on these simple actions:

✅ Maintain a Clean Driving Record: Fewer auto claims and violations lead to lower car rates, which in turn helps secure better home discounts.

✅ Pay Premiums on Time: Protect your insurance score by making sure all policy payments are punctual.

✅ Review Your Bundle Annually: Always check with your agent to ensure your current combined policy offers the best overall value.

✅ Avoid Small, Unnecessary Claims: For minor auto damage, it can often be cheaper to pay out-of-pocket than to risk losing discounts on both policies.

✅ Value Loyalty: Sticking with the same insurer for both policies often results in significant loyalty and multi-policy savings.

Want to maximize your savings by strategically combining your Auto and Home policies?

Speak with a licensed Cal-Society agent today! 📞 Call us at 1-800-773-1663.