Home and Building Insurance with an Insurance Provider: How to Optimise Protection and Costs
31 May 2025
4
Minutes
Katrin Straub
CEO at nextsure
Many property owners wonder whether it makes sense to take out household and residential building insurance with the same company. Bundling can indeed bring advantages, ranging from simpler claims processing to noticeable discounts. Find out here when this step is worthwhile for you and what you should pay attention to.
The topic in brief and concise terms
Bundling home contents and building insurance with one provider can result in discounts of up to twenty percent and simplify claims processing.
A single point of contact in the event of a claim and the avoidance of jurisdictional conflicts are essential advantages of a combined policy.
Despite potential benefits, it's important to always compare the individual services of policies, as separate contracts may sometimes offer better protection.
Quick Facts: Home contents and residential buildings from a single source – The key advantages
The decision to bundle home contents and building insurance with one provider often offers several advantages. A significant benefit is the potential cost savings through package discounts, which can range from five to twenty percent depending on the provider. In the event of a claim, you benefit from simplified processing as you only have one point of contact. This can particularly ease coordination for damages affecting both areas, such as water damage. Many insurers also offer seamless protection, avoiding discussions about responsibilities, for example, for damage to floor coverings.
Practical Part: When is the combination policy really worth it?
In practice, the benefits of a combined contents and buildings insurance become particularly apparent in complex damage cases. Imagine a storm partially removes your roof (a case for the buildings insurance) and the rain that enters damages your furniture and electronics (a case for the contents insurance). With two different insurers, there can be coordination issues and delays. With a single provider, the settlement is streamlined, significantly simplifying and accelerating the process for you as a policyholder. Some providers even offer up to a twenty-five percent discount on the contents policy when taking out buildings insurance at the same time. This saving can amount to a significant sum over the years.
Another aspect is the avoidance of coverage gaps. Sometimes, the allocation of damage is not clear-cut; for instance, with permanently glued carpet or fitted kitchens. The distinction between contents and fixtures can be challenging. When both are insured with the same provider, such debates often become moot. This leads to faster and more customer-friendly claims handling. Therefore, bundling is not just a question of price, but also of convenience and security in critical situations. Consider whether the potential savings of, say, ten percent outweigh the advantages of a separate, possibly more specialised policy.
Calculation example: Potential savings from bundling
Assume your separate building insurance costs €300 per year and your contents insurance costs €150 per year. Thus, your total annual costs amount to €450. If you choose a provider that offers a ten per cent combination discount, you save €45 annually. With a discount of twenty per cent, you would save €90. Over a contract period of five years, this adds up to €225 or €450 respectively. This direct financial relief is a strong argument for bundling.
However, do not just consider the discount. Carefully compare the underlying services. A cheaper combo policy with worse conditions is not a good trade. Sometimes, it may be worthwhile to take out two separate contracts with specialists, even if they cost slightly more, if this means significantly better protection for your individual situation. Therefore, careful consideration of costs and the extent of coverage is essential before making a decision for or against a combined home and building insurance.
Expert Depth: Legal Aspects and Design Tips
Legally, there is no regulation that requires or prohibits household and home insurance with a single provider. The decision rests solely with the policyholder. Recent rulings in insurance law often concern detailed questions such as the distinction between robbery and theft or the assessment of gross negligence. These rulings can influence the interpretation of insurance terms, regardless of whether you have bundled or separate policies. Our expert tip: Pay attention to clear and understandable insurance conditions (AVB), especially regarding clauses on obligations (e.g., use of a safe) and increased risks. An unclear formulation can lead to disputes in the event of a claim.
When designing your contracts, you should consider the following points:
Waiver of underinsurance: Ensure that both policies include a waiver of underinsurance to avoid reductions in the event of a claim. This is often linked to a correct determination of the sum insured.
Natural hazard protection: Check whether a natural hazard insurance is sensible and included in the offer for both areas. Damage from natural events such as flooding or heavy rain is increasing.
Coverage amounts: Adjust the coverage amounts individually to the value of your household contents and the reconstruction costs of your building. A blanket sum is rarely optimal.
Deductibles: Clarify the level of deductibles for both types of insurance. A higher deductible can lower the premium but means more personal costs in the event of a claim.
Consultation with professionals, such as those offered by nextsure, can help avoid pitfalls and ensure optimal protection. It is important that the insurance conditions, often recorded in the General Terms and Conditions of Insurance (AVB) or specific product conditions (e.g., VGB for residential buildings, VHB for household contents), meet your needs. For example, whether a fitted kitchen counts as household contents or part of the building can be answered differently depending on the contract.
Possible drawbacks and when separate policies might be better
Although combining home contents and building insurance often offers benefits, there are situations where separate policies might be the better choice. A potential drawback of the combined solution is that the insurer may not offer the best terms or the most comprehensive coverage in both areas. For example, a provider might have excellent building insurance but only an average home contents policy. In such cases, choosing two specialised providers could result in better overall insurance coverage, even if this might come with slightly higher total costs or more administrative effort. Therefore, always check the detailed differences in services, not just the final price.
Another point is flexibility. If you bundle your insurances with one provider, switching can be more complicated if you are dissatisfied with one area. You might then have to cancel and re-establish both contracts, which could mean losing combined discounts. With separate contracts, you can respond more flexibly to changes in your needs or better offers on the market by adjusting or switching only the relevant policy. Consider whether the convenience and discount of a combined policy outweigh this potential limitation of flexibility for you. A building insurance is not always mandatory for owners, but it is highly recommended.
The path to optimal decision-making: Individual needs analysis
The question of whether household and building insurance are sensible with one insurance provider cannot be answered in a blanket manner. It strongly depends on your individual needs, your risk profile, and the specific offers of the insurers. Start with a detailed analysis of your needs: What is the value of your household contents? What specific risks exist for your building (e.g., location in a flood-prone area)? Do you need special additional services like glass insurance or enhanced protection for bicycles? Note down at least three priorities for your insurance coverage.
Subsequently, obtain several comparison offers – both for package deals and separate policies. Pay attention not only to the price, but also compare the scope of services, exclusions, and excesses in detail. Thorough research and a comparison of at least three different offers are crucial. Also, use independent comparison portals and consider professional advice. In this way, you ensure that you find the best and most economical solution for your situation. Remember that life circumstances can change; it is advisable to regularly review your insurance situation, perhaps every three to five years.
Conclusion: Home contents and residential building insurance with one provider – often a wise choice with care
In summary, bundling household and residential building insurance with one provider can be a sensible option for many property owners. The main benefits include potential cost savings of up to twenty per cent through discounts and simplified claims handling with just one point of contact. This can save a lot of time and hassle, especially in cases where both areas are affected. Avoiding jurisdictional disputes in borderline cases, such as damage to fitted kitchens, is another significant advantage.
However, it's important not to blindly accept the first combined offer. Carefully compare the services and conditions of the individual policies. Sometimes a provider may excel in one area but offer only average protection in another. In such cases, or where very specific coverage needs exist, separate contracts might be the better choice despite potentially higher costs. Individual advice, as offered by nextsure, helps you find the best solution for your comprehensive protection.
Request an individual risk analysis now: Have your insurance situation reviewed for free and receive specific optimisation suggestions.
More useful links
The GDV (Gesamtverband der Deutschen Versicherungswirtschaft) provides information on the protection against natural hazard damages.
The Federal Statistical Office (Destatis) provides price indices and other economic statistics.
Under Gesetze im Internet you will find the Insurance Contract Act (VVG) from 2008.
The Deutsche Wetterdienst (DWD) informs about climate change and its effects.
The Environment Agency offers insights into the monitoring of the German Adaptation Strategy in the financial sector.
The BBK (Federal Office for Civil Protection and Disaster Assistance) provides an assessment of heatwaves and heavy rainfall events.
The Stiftung Warentest examines price developments in residential building insurance for homeowners.
FAQ
Is it always cheaper to take out home contents and building insurance with the same provider?
Not necessarily. Although many insurers offer combination discounts, you should always compare the overall performance and premiums. Sometimes two separate policies from specialized providers may be more suitable or even cheaper, even without a discount, when considering the scope of coverage.
What disadvantages might there be when having both insurances with one provider?
A possible disadvantage is that the provider may not offer the best conditions in both areas. Additionally, changing providers can be more complicated if you are only dissatisfied with one part, as this can affect the combo discount.
What should I pay attention to when comparing combination offers?
In addition to considering the price and discounts, pay special attention to the scope of coverage of both policies, exclusions, the amount of coverage, deductibles, and whether important additional components such as natural hazard protection are included.
How do I determine if a combined policy makes sense for me?
Analyse your individual needs, compare multiple offers (combined and separate), and pay attention to the details of the insurance terms. Professional advice can help you make the right decision.
Do home contents and building insurance cover the same risks?
Both insurances cover similar basic risks such as fire, tap water, storm, and hail. The difference lies in what is insured: the building insurance protects the building itself and its permanent fixtures, while the contents insurance covers the movable inventory inside.
What is the difference between replacement value and current value in these insurances?
Home contents insurance usually covers damage at new value, meaning the cost of replacing new, equivalent items. Similarly, buildings insurance generally provides new value for repairs or the reconstruction of the building at current construction prices.
