Best Auto Insurance Companies for Paying Claims (2021)
The best auto insurance companies for paying claims may not be the largest ones or the cheapest. Based on recent consumer ratings, local and regional car insurance companies reign supreme. The best car insurance companies for paying claims may excel in three areas, including financial strength. USAA, which has a $40.4 billion net worth and high praise from its clientele, fits the bill.
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UPDATED: Sep 8, 2021
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- To determine which car insurance company is best at paying claims, you should look at three factors, one of which is consumer ratings
- USAA and State Farm might be two of the best auto insurance companies for paying claims based on financial strength and strong consumer ratings
- Other highly rated companies for paying claims were regional in scope
What are the best auto insurance companies for paying claims? The answer may surprise you — unless you hold policies from one of these companies.
Do these companies offer cheap car insurance? Does the list include companies like Allstate or Progressive? Both companies have a large share of the car insurance market. However, customers have filed numerous complaints about the claims process for both.
When evaluating an auto insurance company, the claims process is one of the top aspects you need to consider. To that end, there are at least three factors you need to weigh during your evaluation. What are they?
Read on to learn about the best auto insurance companies for paying claims and how to determine if a company’s claims process will be easy. To see rates from top companies in your area right now, enter your ZIP code into our free quote tool above.
How can you determine if an auto insurance company is good at paying claims?
To assess a company’s claims process, you need to look at three areas:
First, look at financial strength. If your insurer has a high net worth, it is more likely to pay out claims.
Second, look at the total payments that the company makes to its policyholders. Companies will often give you access to reports showing how much money they have paid out in claims over their lifetime and in the previous year, along with the total number of claims fulfilled.
You should weigh this information against a company’s clientele size.
Third, look at a company’s customer service. While many factors can contribute to a company’s customer service ratings, one factor is the claims process.
Some companies make it easier for policyholders to file claims than others. What’s important is whether customers get a payout and how transparent insurance agents are about the process.
Now, numerous firms look at some of these factors. For example, rating agencies like A.M. Best, Moody’s, and Standard & Poor’s give car insurance companies ratings based on total revenue and liabilities.
Companies like J.D. Power and the National Association of Insurance Commissioners look at customer satisfaction, with the latter tracking complaints. You can also get customer reviews from many other official and informal sources, like online message boards, or even through word of mouth.
That said, what do you think are the three best auto insurance companies at paying claims? Read on to find out.
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What are the three best auto insurance companies for paying claims?
The three best car insurance companies for paying claims are USAA, Amica, and the New Jersey Manufacturers Insurance Group (NJM). However, these three companies are limited in coverage.
- USAA is only available to military veterans, current members of the military, some government employees, and the immediate family members of the above.
- Amica is not available in Hawaii.
- NJM is only available in New Jersey, Pennsylvania, and Ohio.
Still, customers continue to hold these companies in high regard in large part due to the claims process.
Auto Insurance Companies’ Financial Strength
All three companies are solvent.
- USAA, which has 13 million total policies in effect, listed a $40.4 billion net worth in 2020. It received an Aaa from Moody’s and an A++ rating from A.M. Best.
- Amica has $5.4 billion in assets and 1.6 million policies in effect as of 2019. It also has an A+ rating from the Better Business Bureau and A.M. Best.
- NJM has an annual revenue of $2.2 billion.
Out of these three companies, USAA is the strongest financially.
Auto Insurance Companies’ Total Payments
Now, not much is known about Amica or NJM’s financials, but USAA has offered more information. For 2020, USAA paid out $2 billion in claims and $1.1 billion in special policyholder dividends.
Auto Insurance Companies’ Customer Service
- Amica scored 867 out of a possible 1,000 points in New England.
- NJM also scored 867 points, but in the Mid-Atlantic region.
- USAA outscored all other companies in the regions where it was available, although it is unofficial. The company was just as impressive in the 2020 survey.
Furthermore, NJM was the first company to earn the J.D. Power Personal Auto Claims Certification. The company has maintained that distinction for three years in a row.
How do the best auto insurance companies for paying claims compare to top-tier companies?
If we go with J.D. Power’s most recent survey, four larger auto insurance companies that stood out were State Farm, Erie Insurance, American Family, and GEICO.
State Farm took top honors in three regions. It received 848 points in Florida, 844 in the Northwest, and 859 in New York. State Farm has received top ratings in New York for two years straight.
Erie earned 857 points in the North Central region to top all other auto insurance companies there.
In terms of its financial stability, State Farm received an A++ rating from A.M. Best. That is the highest rating that a company can receive. S&P gave State Farm an AA ranking, which is very strong.
Erie Insurance only operates in 12 states, but it has excellent financials.
- It’s a Fortune 500 company, ranking at #347 for 2021.
- It is the 13th-largest auto insurer in the nation.
- In 2021, Erie received an A+ (Superior) rating from A.M. Best.
American Family received the best rating (850 points) in the Southwest, a distinction it holds for a second consecutive year. AmFam has earned an A (Excellent) rating from A.M. Best for 18 years straight.
Even though GEICO never came out on top in any region, it consistently appeared in the top 10. Its total assets are worth $32 billion, and it received an A++ from A.M. Best and an AA+ rating from S&P.
Best Auto Insurance Companies for Paying Claims: The Bottom Line
We should note how well some smaller companies did in J.D. Power’s survey.
- Wawanesa (853) took top honors in California.
- Farm Bureau Insurance – Tennessee (833) reigned supreme in the Southeast for the 10th consecutive year.
- Texas Farm Bureau (850) has topped all other companies in Texas for 20 straight years.
So, what are the best affordable auto insurance companies for paying claims? Rankings and ratings seem to strengthen the case for USAA, Amica, and NJM.
Ultimately, size does not guarantee that a company will offer the best insurance for claims. Sometimes, policyholders are more likely to be happy with a smaller, local company or a company with a targeted clientele, like USAA.
This is the information you should keep in mind if you want to buy car insurance from the best auto insurance companies for paying claims. Remember, while a company might have a decent suite of coverages, the insurance might not be worth the price if the company hardly pays any claims.
In the end, if you want to know which insurance company is best for paying claims, you may need to go with word of mouth or with a regional company. Sometimes, the best companies are local, and they may offer the cheapest car insurance rates, too.
Hopefully, you’ve learned a lot about the best auto insurance companies for paying claims. Now, if you’re ready to see quotes from top companies in your area, enter your ZIP code into our free quote tool below.