By JENNIFER SARANOW
Staff Reporter of THE WALL STREET JOURNAL
May 18, 2005; Page D2
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Major insurance companies are increasingly bundling together a wide range of coverage, from home to auto, into a single policy.

The one-policy packages are designed to eliminate the hassle of multiple bills, multiple expiration dates and possible gaps in coverage, by making insurance easier to renew. But the convenience comes at a price: The policies are generally more expensive than standard policies because they contain more coverage.

MetLife Inc. is the latest of a small group of insurers rolling out package policies in order to try to get business back from auto-only insurers, which have gained market share in recent years. According to the Insurance Information Institute, about a third of all property-casualty premiums comes from auto insurance.

COMBO POLICIES

Insurers are increasingly rolling out products that combine home, auto and other types of insurance into one policy with one renewal date, one bill and in certain situations, one deductible. Here's a look at when the deductible discount applies.
COMPANY DEDUCTIBLE
Allstate Corp. If damage occurs to one's home, car or other property such as a boat at the same time, only one deductible applies.
Chubb Group Doesn't offer one deductible for damage to both home and auto from the same loss. Does offer one deductible for damage by same cause to a home and its contents, or an auto and its contents.
MetLife If there's a large loss involving multiple items (auto, boat, home, recreational vehicle, etc.), at the same time, only the highest deductible applies.
Source: The companies
MetLife's policy, called "GrandProtect," involves one premium, one renewal date and, in certain situations, one deductible for multiple types of coverage, including home and auto. Allstate Corp. has offered since 1999 one policy under its Encompass brand covering a policyholder's cars and home with one effective date, one bill and, in certain situations, one deductible. Chubb Corp.'s Masterpiece brand, meanwhile, has long offered most policyholders the ability to package their home and auto insurance into one policy with one bill and one statement. Typically, auto insurance and home insurance aren't available under one policy and generally not with other types of personal policies.

MetLife is gearing GrandProtect to those people with complex insurance needs. To qualify, a consumer must have one house, generally worth at least $250,000, and one car. MetLife says the typical GrandProtect customer has two cars and one or more homes and purchases additional jewelry and umbrella liability coverage. A typical premium runs $2,800 to $3,600 annually, according to MetLife.

GrandProtect replaces a previous policy called Pack II that packaged home and auto together and was offered in only certain states. But MetLife says its new product involves more coverage levels than the previous packaged policy and has more sophisticated pricing. Unlike Pack II, GrandProtect includes guaranteed replacement of a home and identity-theft reimbursement coverage. GrandProtect also offers coverage not part of MetLife's standard home and auto insurance, such as extended liability coverage for boats, higher limits for jewelry, silverware and collectibles and world-wide liability coverage for rental cars. Life and disability insurance policies aren't included.

MetLife, which began testing the product in March in Oregon, Tennessee, Minnesota and Arizona, plans to roll it out in Ohio, Illinois and Rhode Island next week. The company expects to offer it in 19 states by the end of the year, and nationwide by 2007.

Companies are looking to make their one-policy products more convenient and easier to renew by allowing customers to keep all of their policies with one company and to avoid multiple bills and expiration dates and possible gaps in coverage. Packaging policies into one statement and one renewal date also helps insurance companies to cut paperwork and other costs.

"A much greater percentage of the population is accumulating more assets and have less time to manage" insurance, says Noel Edsall, director of product development with MetLife Auto & Home.

GrandProtect premiums run higher annually because of the additional coverage involved, 3% higher for auto than MetLife's standard auto insurance and about 20% higher for homeowners than its typical homeowners policy.

If multiple items, say a house and car, are part of the same major event loss, say due to a hurricane or fire, policyholders would have to pay only the highest of the deductibles involved. If only one item is damaged or if items are damaged by different losses, then customers would have to pay the deductibles for each policy involved.

Other companies are also gearing their products to wealthier clients. In addition to cars and homes, Allstate's Encompass covers secondary homes, boats, jewelry, furs, stamp collections and fine art. Policyholders are required to have homes with market values that are in line or above the national average. Encompass tends to have higher limits on certain items -- such as artwork, jewelry and furs -- than a standard policy. The average premium for the package policy is about $2,950 annually.

Before opting for GrandProtect or another packaged product, consumers might want to shop around and compare the prices they would get if they bought the policies separately. According to J. Robert Hunter, director of insurance at the Consumer Federation of America, though there might be cost savings down the road if such one-stop policies go mainstream, for now the policies tend to cost more than if you had purchased the policies individually.

"Companies always err a little bit on the high side when they first introduce a product to make sure they have enough premiums coming in," he says. "It could well be that when you shop around and get the prices separately of say auto and home, you may still be able to do better."

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