When one has car insurance alone, insurance companies state that if one is to also get home insurance from the same company, the sum of the two insurances will be less than the original car insurance alone... Why should insurance companies take less premium for providing more service?

Insurance company would like insured to stay with the company as long as possible to service their insurance needs. It's been proven that in insured have more than one kind of insurance with an company the insured unlikely to change. But usually combine two insurance should not be less than orginal car insurance alone. You might want to double check with your insurance agent. There should be discount like 10% to 20% of the total premium of two insurance policies depend on the state and the insurance company! Hope this will help!

that's loyality discount to get more business from same number of clients. It is a very competitive world out there.

Well, there is nothing suspicious in their actions
Companies do this to have more life-time clients. Premium really drops, if you combine your home and auto insurance and purchase them from ONE company.

Many companies have a discount for either the home or auto premium when you buy both.

They are collecting more premium. As long as the risk fits the profile they are approving they give a discount for having the business combined. It's a matter of collecting more money from the insured.