Auto vs. Home Insurance: Where Should You Spend More?

Understanding the Battle of the Policies

Insurance can be confusing, right? If you’re like most people, you probably ask yourself, “Am I spending too much on insurance?” or “Should I be paying more for auto or home insurance?” You’re not alone! This article breaks down the facts, real-life risks, and what’s actually worth your money.

What Is Auto Insurance?

Auto insurance is designed to protect you financially when you hit the road. It helps cover the costs related to accidents, theft, or damage involving your vehicle. The most common types of auto insurance include:

Liability Coverage: Covers damage you cause to others.
Collision Coverage: Pays for damage to your car in an accident.
Comprehensive Coverage: Covers non-collision events like theft, vandalism, or weather.

What Is Home Insurance?

Home insurance safeguards your home and belongings against damage or loss. Most policies cover:

Fire and smoke damage
Theft or vandalism
Weather-related damage (like wind or hail)
Liability if someone gets hurt on your property

It’s a safety net you hope you’ll never need—but will be thankful for if disaster strikes.

Auto vs. Home Insurance: What’s Covered?

Auto insurance focuses on mobility risks—collisions, traffic accidents, and damage on the go. Home insurance, on the other hand, protects your biggest investment: the place you live.

If your car gets rear-ended, your auto policy steps in. If a tree crashes through your roof during a storm, your home insurance pays for repairs. It’s that simple—different protections for different needs.

Cost Comparison: What’s More Expensive?

Auto Insurance: The average annual premium in the U.S. is around $1,700.
Home Insurance: Averages about $1,300 per year—but can vary widely.

Why the difference? Your driving record, car model, and location impact car insurance costs. Meanwhile, your home’s age, size, and geographic location affect your home insurance rate.

Want to know how to lower your costs? Check out this handy guide on how to save money on your broadband and utility bills—some strategies apply to insurance too!

What Influences Auto Insurance Rates?

Driving record
Age and gender
Type of car (sports car vs. sedan)
Zip code (accident rates matter)
How often you drive

What Influences Home Insurance Rates?

Natural disaster risks (flood zones, hurricanes)
Home value and construction type
Proximity to a fire station
Home security systems

Which One Do You Use More?

Let’s be real—how often do you drive compared to how often your home is at risk?

Most Americans drive daily. This constant exposure to risk means auto insurance claims are more frequent, even if they’re less costly. So if you commute long hours or live in an area with lots of traffic accidents, you might want to beef up your car coverage.

What Does the Law Require?

Every state (except New Hampshire) requires drivers to carry auto insurance. But home insurance isn’t legally required—though your mortgage lender will almost always demand it.

When to Spend More on Auto Insurance

If you’re a high-risk driver (e.g., under 25, live in a city with high accident rates), or if you own an expensive or new car, it’s smart to invest more in auto coverage.

When to Spend More on Home Insurance

If your house is located in a natural disaster zone or contains expensive electronics, jewelry, or heirlooms, a robust homeowners policy is a must.

Want to know more about the distinction between protecting your home and its systems? Learn the difference between home warranties and home insurance.

Bundling: Get the Best of Both Worlds

Many providers offer discounts when you combine both policies. Bundling can mean:

Lower monthly premiums
Easier claims process
One point of contact

Want to find providers that make bundling easy? Check out this guide to insurance providers that offer bundling options.

Choosing the Right Provider

Not all insurers are created equal. Look for:

Good customer service
Easy claims process
Competitive rates

Need help choosing? The JNA insurance platform lets you compare top-rated providers in minutes.

How Budget Impacts Your Insurance Decisions

We get it—insurances can eat up a big chunk of your budget. If you’re driving an affordable vehicle, you might not need premium coverage. Curious about affordable car options? Take a look at this list of cheap cars that are easier (and cheaper) to insure.

Conclusion: Where Should You Spend More?

It depends on your lifestyle. Drive often and in risky conditions? Focus more on auto insurance. Own an expensive home or live in a high-risk area? Prioritize homeowners insurance.

At the end of the day, don’t skimp on either—just be smart about where your risks lie and adjust your coverage accordingly.