The Best Auto Insurance
Get on the road fast, and affordably
It’s hard to think about car insurance as anything more than a monthly expense. But filing a claim isn’t so much an “if” as it is a “when." So we reviewed 41 of the best auto insurance providers based on their ability to serve customers and actually pay out claims; not just on premium cost.
The nation’s second-highest claims satisfaction rating, plus robust coverage options. Just be prepared to call to get a quote.
Excellent customer service ratings, but fewer coverage options and discounts than Hartford.
For many people, it’s really all about the price. We get it. Still, we looked at much more than price in our review. If all you care about is seeing rates in your area, our recommendation is to compare rates using our tool below:
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A 2015 survey conducted by Princeton Survey Research Associates International found that 66% of auto insurance policyholders never or rarely check to see if they could get less expensive coverage compared to their current policy. For most, it’s just another monthly expense. Statistically, though, the average driver will be involved in an accident every 18 years, which means you’re going to need to use it at least three times in your lifetime. We reviewed auto insurance companies on more than just price — we looked at the claims process; we surveyed experts; and we even talked to the people who deal with car insurance companies the most (auto body shop owners).
We started with 41 of the country's best auto insurance companies.
First, we focused on financial solvency.
The most important job an auto insurance company will ever have is paying claims. No one should have to wonder if their provider has the wherewithal to pay up if the worst should happen. That’s why we focused our search on companies with high, nationally recognized financial strength ratings.
Based on the Insurance Information Institute’s recommendation, we evaluated financial strength ratings from three different agencies: A.M. Best, Standard & Poor’s, and Moody’s. We dropped insurers that didn’t have both an A.M. Best financial strength rating of “excellent” (A-) or better, and a “strong” FSR rating (A+) from Standard & Poor’s, or “high quality” FSR rating (Aa) from Moody’s. (Here’s a breakdown of how each agency’s ratings compare.)
21st Century, AAA, AARP, ACE Group Auto Insurance, AIG, American Modern, American Reliable, American Zurich Insurance Company, Ameriprise, Amica, Balboa Insurance Group, CUNA Mutual, Electric Insurance, EMC, Esurance , Everest National Insurance Company, Farm Family Life, Farmers , Federated, Fireman’s Fund, Foremost Insurance, GMAC Insurance, GuideOne Insurance, Hanover Insurance Group, Horace Mann Auto Insurance, Kemper Corp. (Unitrin Direct), Liberty Mutual, Mercury General Insurance, Metlife, Progressive, Protect Your Bubble, Prudential, Response Insurance, The General
Claims processing was essential.
The claims process is where the rubber meets the road when it comes to car insurance companies. Those that get it right are the ones that don’t make a bad situation worse by quibbling over simple claims, or dragging their feet when it’s time to pay.
J.D. Power and Associates is a global marketing information services firm that conducts surveys of customer satisfaction, product quality, and buyer behavior. We used the organization’s claims satisfaction study to determine which auto insurance providers consistently satisfy their customers. We decided that this is best reflected by a score of 861 or greater (out of 950), which is well above industry average. Any companies that received a lesser rating, or no rating at all, were cut.
GEICO, State Farm
Then we looked at coverage options, discounts, and customer support.
The best auto insurance companies need to be excellent at handling claims, but that’s not the end of the customer service story. Any worthwhile insurance company also needs to have high marks in coverage options, discounts, and general customer support. Here’s a breakdown of how we ranked our finalists in each category:
- Coverage Options. We considered the usual bodily injury liability, comprehensive, property damage, medical payments, and collision coverages “must haves,” but we favored companies that offered any of the following, rarer coverage options, too:
- New Car Replacement: Gives you enough money for a new car, not just the depreciated value of your previous vehicle.
- GAP Insurance: Covers the difference between how much your wrecked vehicle was worth, and how much you still owe on your loan.
- Uninsured Motorist Coverages: Protects you if you're hit by an at-fault driver that doesn’t have liability coverage.
- Discounts. These fall into two major buckets: driver and vehicle discounts. We primarily wanted to see companies offering prepay, low-mileage, and multiple-policy discounts, but we also looked for 13 additional types of discounts: accident forgiveness, defensive driver, driving habits, family discount, good driver, good student, loyalty, military, multiple vehicle, organization, anti-theft device, electric vehicle, and vehicle equipment.
- Customer Support. We looked at 42 features (ranging from roadside assistance to paperless billing to a comprehensive customer knowledge base) in six categories: additional benefits, learning materials, on-boarding support, payment options, policy management, and support tools.
The Hartford, Nationwide, Allstate, USAA, Travelers
We didn’t look too closely at pricing (for a reason).
Cost is important when it comes to selecting a car insurance policy, but it shouldn’t be your only consideration. Instead, look for companies that won’t let you down when it’s time to file a claim and that have the coverage options you want, and then comparison shop on price. The last thing you want to do is purchase an uber-affordable policy from a provider that’s going to treat you like an afterthought when you get in a wreck.
“The most important consideration when purchasing insurance is that your company will be there for you when a claim arises.”
“This is not just a solvency concern; it is actually a quality of coverage issue,” he explains. “Is your company dedicated to you (the customer) and will they be there when you need them? Price is secondary to quality of coverage, but, unfortunately, most consumers do not look at it that way. Insurance is not a commodity. You are purchasing a promise to pay. Not all insurance companies are alike, and not all insurance producers are alike. You should always try to balance a company’s (and producer’s) consumer satisfaction rating and reputation with the cost of the insurance.”
It’s also hard to forecast the cost of insurance for any one individual, because premiums are based on a host of driver-specific variables, including age, vehicle, and driving history. In our review of the cheapest auto insurance, we observed a significant variance in premiums (as much as $30 a month) based solely on a driver’s ZIP code. To be clear, that means policies for the exact same person and vehicle can change from neighborhood to neighborhood. This means the only way to find the best rate possible on the policy you want is to get multiple quotes, and then compare them.
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The Best Auto Insurance
Best Overall — The Hartford
The Hartford ranked second-highest for claims satisfaction in J.D. Power’s 2016 study with a score of 891 out of 950. (USAA ranked number one with a score of 895, but we couldn’t make it a top pick due to its military-only eligibility requirements.) The study involved over 12,000 recent claimants, but excluded those whose vehicles were stolen, incurred only glass damage, and those who “only filed a roadside assistance claim.” When you break that down, it means that out of all the people who sustained substantial damage to their vehicle, The Hartford’s customers were the happiest.
The Hartford falls behind Nationwide with regard to GAP insurance, but bests its main competitor with new car replacement, stacked uninsured motorist, and rental car coverages. Stacking uninsured motorist coverage isn’t legal in every state, but those who can take advantage of it can increase their levels of underinsured or uninsured motorist coverages with minimal cost. If you live in a state that forbids having UM/UIM coverages that are higher than your liability coverage, stacking allows you to increase your UM/UIM without having to buy more liability.
The Hartford offered all but two of the 16 different discount types we looked for, including a rare discount for those who drive electric vehicles. No other nationally available insurer offers more discounts, except for Progressive (which didn’t make it into our list of finalists due to subpar financial strength ratings). The two discounts it doesn’t offer are loyalty and military.
If The Hartford has an Achilles’ heel, it would be the online quote process. We tried over a dozen different approaches, but were always met with, “We are unable to process your insurance transaction online. In order to finish your quote, please contact us by phone.” Truth be told, it kinda feels like The Hartford never intended to give a full quote online at all, which we’d consider a misleading way to generate leads.
Runner-Up — Nationwide
Nationwide has the third-highest J.D. Power satisfaction ratings in the nation (behind USAA and The Hartford), and that’s mainly why it’s our Runner-Up pick. Amica is the only other company we reviewed that landed in J.D. Power’s top echelon, but it didn’t have the financial strength to knock Nationwide off the second-place pedestal. Nationwide’s financial stability ratings (an A+ from A.M. Best and S&P) are right on par with The Hartford. Any of our five finalists will be able to pay your claim without breaking a sweat, but having top marks in both claims and financial strength is commendable in our book.
A Note on Rental Car Coverage Most personal auto policies automatically include collision coverage for rentals, so make sure to check with your current provider before handing out more cash for a useless coverage. You might also have inherent liability coverage through your homeowner’s policy, or even your credit card, so check there as well.
Nationwide is also the only auto insurance provider aside from Progressive that offers “Pet Injury Coverage.” So if Whiskers sustains a broken leg after someone rear-ends your car at a stoplight, you won’t have to pay the vet bill out of pocket. You can also buy full-on pet health plans from Nationwide a la carte.
If you’re a frequent traveler, it’s important to note that Nationwide is one of only two countrywide insurers that does not offer rental car coverage. (The General is the other.) Yes, you can buy statutory minimum liability insurance from the rental company, but Neil Abrams, an auto rental consultant for Abrams Consulting Group, told US News and World Report that “in a significant event, that’s not going to do much for you.” He went on to say that in the technical sense, “it’s not insurance.” On top of that, rental car companies’ agreements are riddled with fine print, so the path with the least amount of stress is leaving that coverage up to your primary auto insurance provider. Unfortunately, Nationwide can’t provide it.
Nationwide customers also can’t take advantage of prepay discounts, low-mileage discounts, new car replacement coverage, or stacked uninsured motorist coverage. None of those are deal breakers by any means, but all are available from The Hartford.
Other Auto Insurance Companies to Consider
USAA only services members of the US military and certain family members, including:
- Active, retired, and honorably discharged officers and enlisted personnel.
- Cadets and midshipmen at US service academies, in advanced ROTC or on ROTC scholarship, plus officer candidates within 24 months of commissioning.
- Former USAA members who had auto or property insurance.
- Widows, widowers, and un-remarried former spouses of USAA members.
If you qualify for USAA, you should seriously consider it. Here’s why: It has the highest possible ratings from A.M. Best (A++) and Moody’s (Aaa), and the second-highest rating from Standard and Poor’s (AA+). On top of all that, it boasts the top claims satisfaction score from J.D. Power. To be clear, USAA is in a league of its own, and only disappointed us regarding two of our favored policy options: GAP insurance and a prepay discount. If not for the eligibility requirement, it would have been our top recommendation.
Allstate’s a really close competitor to The Hartford, but doesn’t offer nearly as many discounts. For example, Allstate doesn’t offer discounts on driving habits, family, multiple vehicle, organization, or electric vehicles. It does come out on top in the finance department, however, with a slightly better FSR rating from S&P, and it’s the only provider aside from Amica to offer interior vehicle coverage. This option protects against interior wear and tear, like ripped upholstery, which is different from damage covered by comprehensive insurance.
It’s also worth mentioning that Allstate’s quote process is the best in the business. Each step is broken down intuitively, making it easier for those who don’t have a great understanding of what auto insurance is or how it works. It’s also the only one of our finalists that lets you edit your policy from your smartphone.
Travelers has excellent financial standing (an “A++” from A.M. Best and a “Aa2” from Moody’s), and scored just above the industry average in J.D. Power’s claims satisfaction study. It offers all the basic coverages and discounts we were looking for, but a lack of customer support tools, including live chat, mobile quotes, tutorials, a knowledge base, and GPS functionality in the app, kept it from standing out. All of these things are helpful when filing a claim from your smartphone. Outside of USAA, it’s also the only insurer that offers a military discount.
Amica didn’t pass our financial strength filter: It has excellent marks from A.M. Best, but it returns no ratings at all from S&P, Moody’s, or Fitch. That left us scratching our heads, but it doesn’t mean Amica isn’t worthy of consideration. It has the same J.D. Power claims satisfaction score as Nationwide. What’s lacking, however, are a few common discounts (including prepay and low mileage) and a policy management dashboard like The Hartford and Nationwide, which means you have to speak with an agent to edit your policy. Another minor miss for Amica is in the payments department: Customers are required to make payments online; you can’t mail them in or pay them by phone.
Did You Know?
It’s best to shop for a new policy every two years.
Even if you are satisfied with your current provider, you should shop for a new policy every two years or so. Why? Two words: price optimization. In 2013, Earnix (a software platform for pricing analytics and optimization) discovered that 45 percent of larger insurers maximize profit by building premiums based upon how much they think customers are comfortable paying. They do this by mining personal data, like online shopping habits and credit scores, to determine how likely you are to switch companies if your rates go up.
You’re getting charged based upon how much money an auto insurance company thinks it can squeeze out of you.
Applying for new policies on a regular basis is the best way to avoid falling victim to price optimization because, just like the data they mine to analyze you, insurers see how often you get quotes. The more you shop, the more volatile you become as a customer — and that means your insurer won’t risk nickel-and-diming you to death.
Shopping around is the only way to know if you’re getting the best deal possible. For example, if you recently turned 25, you qualify for a lower rate because you are viewed as lower-risk driver, but your current provider might not notify you of your new eligibility. If you’ve had a clean driving record for a number of years, you may also qualify for a discount. Comparing prices annually will highlight your options, and it also gives you leverage to negotiate a better rate with your current provider.
Claim frequency greatly impacts your premium.
In the eyes of an insurer, a higher claim frequency is directly correlated to your level of risk. So to keep your premium as low as possible, consider fixing smaller damages on your own. If you find someone has knocked off your side-view mirror, for example, that might be a $100 fix (depending on your car’s make and model). But if you claim that against your collision coverage, you could risk upping your premium by $20 per month, totaling $240 per year for damages that are easy to fix.
Here’s another, slightly obvious way to decrease claim frequency: Be a better driver. The more care you take behind the wheel, the less likely you are to back over your mailbox or rip your fender on a curb. Speeding tickets are another easy thing to avoid that can also increase your monthly premiums.
It’s OK to ask for discounts.
It’s OK to call your provider and see if you can apply for any new discounts — especially if you’re a long-time customer. Insurers want to keep you around, and they’ll do what they can to make it happen. Some life events might qualify you for a price break, including losing a job and paying off your vehicle. It’s like they say: “You never know until you ask.”