Posted with permission from Clark.com

It seems insurance premiums always continue to creep up no matter if you’ve had a recent claim or not. The external factors that could contribute to the rise are not only too complex for the average insurance customer to understand, but in many cases totally out of their control.

So if you want to save on insurance premiums, options are sparse — but there is hope. A new Quandrant Information study commissioned by InsuranceQuotes.com finds that consumers who choose to bundle multiple premiums can possibly save big money.

The study uses a hypothetical consumer — a 45-year-old married woman who lives in the South — to show how combining premiums into one package can save insurance customers a decent amount of cash.

Bundling your insurance premiums can lead to big savings

In the example listed in the study, the insurance customer mentioned above is from Mississippi and has a bachelor’s degree, no coverage lapses and top-notch credit. By combining her auto and homeowners insurance, she can expect to save an average of 23% on her annual premium, the study shows.

Of course, what you save will vary depending on where you live and your personal history of credit, accidents and other factors. One person may be able to cut their insurance premium in half while the other may only see little savings.

According to the study, the average discount for bundling home and auto is at 16%, while bundling auto and renters insurance will save about 8% on an annual premium.

The real reason bundling insurance premiums saves you money

Now why would bundling be cheaper? If you think insurance companies are doing this because they’re looking out for you, think again. They’re doing it because it’s a tried and true tactic to keep customers.

“This all comes down to competition,” Tennessee-based insurance broker John Hatcher says. “There are so many companies out there that can offer lower rates that it’s become harder to keep customers long-term. But the more policies you have with one insurer the longer you are likely going to stay with that company.”

States in the South offer the biggest savings, according to the study, with Louisiana (where customers can save a whopping average of $590 a year on average) being No. 1. Here are the states with the largest percentage premium discounts on average due to bundling home and auto insurance.

  1. Mississippi — 23.2% discount
  2. Arkansas — 22.6% discount
  3. Missouri — 22.5% discount
  4. Illinois — 22.5% discount
  5. Minnesota — 22.4% discount

And here are the five states with the smallest percentage premium discounts on average due to bundling home and auto insurance:

  1. Florida — 6.7% discount
  2. Hawaii — 10.6% discount
  3. New York — 11.5% discount
  4. Vermont — 11.6% discount
  5. Connecticut — 12.1% discount

Don’t overpay for homeowners insurance

RELATED: Best and worst insurance companies