Best Auto Insurance Companies Compared [2020 Update + Rates]

We can all count on both hands and feet the times we were almost in a car accident or we witnessed an almost accident.

Luckily, with experience comes increasingly defensive driving skills, so we should all take the responsibility and stay alert behind the wheel.

But what about the one or two times in our lives when almost becomes a reality? Who will have your back? Who will pay your medical bills? Who will repair or replace your vehicle?

The annual economic cost of car accidents in the United States is an estimated $242 billion.

Here are a few more statistics from 2013 provided by the National Highway Traffic Safety Administration (NHTSA).

• $3,231 – The average automobile liability claim for property damage
• $15,443 – The average liability claim for bodily injury
• $3,144 – The average collision claim
• $1,621 – The average comprehensive claim

There are numerous car insurance companies of varying types and sizes, so choosing who will have your back may be just as risky as driving without insurance.

In this guide on the best auto insurance companies, we examine rates, financial stability, and reputation in customer service of the top 10 car insurance providers in the nation. Also included are links to our company reviews, so you can make an informed decision.

Looking for the best way to compare car insurance company rates? Look no further, we have you covered! Enter your ZIP code into our FREE tool to get started.

The Top 10 Car Insurance Companies in the Nation

Can you believe that 72 percent of the national market for private passenger automobile insurance is dominated by only 10 car insurance companies?

Even more unbelievable is that only four of those 10 car insurance companies share 51 percent of the same market.

We aren’t here to tell you which company to choose, but we are here to inform you of nearly every aspect to consider when making your choice. For this reason, the companies are listed in alphabetic order in all tables; however, by clicking on the triangles in the headers of each table, you can sort to your liking and find out for yourself.

So, let’s cut right to the chase.

Availability and Rates

Before going any further, let’s make sure you know who can have your back in your state. All of the top 10 car insurance companies operate in all 50 states except for American Family, Nationwide, and Travelers. If you would like to consider one of these three companies, be sure to read our company reviews to make sure it is an option for you.

The table below includes each of the top 10 companies, their average annual premium on a national scale compared to the national average, and their cheapest insured vehicle.

Now, just because this table shows USAA and State Farm have the lowest premiums doesn’t mean you should immediately dial that number. USAA has the best prices of all the companies, no matter which way you look at it, but this company writes only for military personnel and their family members.

If you aren’t affiliated with the military, you may be leaning toward State Farm. However, this may not necessarily be your best option.

Our researchers have found that location and the carrier are the two most influential factors in determining rates.

Looking for a reliable auto insurance company can be a long and difficult process. The first step in choosing the right insurance provider is to determine your needs.

A great place to start is by searching for information about the main types of coverage and evaluate your budget. Don’t assume that you will get the same rates from each company.

If you’re tired of paying high premiums and you’ve found a more affordable policy, make sure to check the fine print on your existing policy before canceling it mid-term.

Mid-term cancellations are allowed, and you can purchase a new car insurance policy at any time. However, it is important to check with your insurance company and the regulations in your state to determine if you will need to pay any cancellation fees.

So, the best auto insurance company for you depends on where you live, the laws in your state, and several other factors unique to you. We will cover all of these factors in this article.

Financial Stability

The future financial stability of a company can often be judged by its historic financial stability, especially in comparison to its top competitors. In addition, third-party entities such as AM Best use an intricate algorithm to rate and predict the financial stability of a company.

The National Association of Insurance Commissioners (NAIC) releases an annual report, available to consumers, that examines the financial stability of all car insurance companies. The three figures consumers like yourself can use to judge the financial stability of a company are:

• Direct Premiums Written: the total dollar amount in premiums received by an insurance company without any adjustments.
• Market Share: indicates the degree (in percent) of market concentration in a line of business.
• Loss Ratio: a percent that represents the amount paid out on claims against what a company earns in premiums.

The table below shows these three figures for the top 10 companies in the car insurance market for 2018 and indicates whether they’re rising (↑), falling (↓), or remaining steady (~) based on NAIC data from 2015 through 2018. To see more specific trend data for these three figures, check out our company reviews.

It’s assumed that any company’s goal is to increase profits, but the level of competition and financial stability is seen mostly in market share and loss ratios, especially when it comes to companies in the top 10.

Later in this article, we will take a closer look at the top four contenders and their history of brutal battles toward winning a war that’s raged since the early- to mid-1900s {insert epic, movie battle sequence}.

Note that loss ratios can fluctuate from year to year, but they should still stay in the safe zone: 60 to 70 percent. A loss ratio that is lower than 60 percent shows the company is not paying out on claims. A lost ratio above 70 percent shows the company may be losing money.

If you like to geek out on ratings, all 10 of our company reviews provide additional financial stability ratings from the following agencies:

• Moody’s
• Standard & Poor’s

Reputation Among Consumers

Looking at the dollars and percents is grand, but what about services provided to their customers?

When choosing (or changing) car insurance, it’s important to examine the satisfaction of both new customers and the customers that file a claim. Luckily, J.D. Power collects data on both.

J.D. Power is a well-known go-to source for customer ratings of all sorts. Their comprehensive surveys are completed by over 40,000 participants.

For example, one of the questions in the 2011 survey that J.D. Power asked of respondents was about the speed and frequency in which auto insurance companies pay claims and treat customer interactions.

• For those companies who quickly settle claims for their policyholders, the ratings on this variable were high.
• For other companies who regularly deny claims or are slow to pay, customers rated these business as poor.

Any auto insurance consumer wants to be sure that if they ever need to file a claim, the claim will be handled in a quick and efficient manner. No one anticipates having a claim denied when they are in an accident.

Companies that settle claims quickly are bound to keep their customers happy and retain their customer base.

We share data here from two of their annual surveys: the U.S. Auto Claims Satisfaction Study and the Insurance Shopping Study.

J.D. Power uses Power Circle Ratings. These ratings are calculated based on the range between the highest score and the lowest score (per survey item) and places a company on that range with one to five circles.

Five circles = among the best; one circle = the rest. J.D. Power may assign one or more power circles to any company; however, they publically announce and/or publish only those ratings that are two power circles or higher.

So, it basically works much like a distribution curve grouping the companies in the top 10 and/or 20 percent. This essentially translates to: the companies that did exceptionally well in a category make the companies that did well look less appealing.

Distribution curves work particularly well in a competitive environment. Here is a great video explaining the difference between a more traditional bell curve and a more competitive distribution curve.

The table below shows J.D. Power Circles (and translates them) awarded in two categories: satisfaction of new customers and satisfaction of customers that file a claim. J.D. Power awards Power Circles in many other categories as well.

Official complaints about how car insurance companies do business are tracked by the NAIC. This agency calculates a complaint ratio for each company and compares it to the collective national complaint ratio.

The complaint ratio is determined by looking at the number of complaints per year per $1 million of premium earned by the total in annual premiums. In 2018, the collective national complaint ratio was 1.15; a ratio lower than 1.15 is good, one higher than 1.15, not so good.

But you’ve got to look at both sides of the coin.

For example, USAA has some of the best rates in the country, and J.D. Power awarded them five Power Circles on handling claims; however, they have one of the highest complaint ratios, squeaking in right under the collective national complaint ratio of 1.15.

Nationwide is in a similar situation, except J.D. Power awarded them three Power Circles on handling claims, though they have the lowest complaint ratio out of the top 10 companies.

It’s difficult to say if any of the official complaints submitted for both USAA and Nationwide were related to handling claims, but this is a great example of how important it is to do your research about each company from every angle.

To dig into the opinions of consumers, all 10 of our company reviews provide additional customer satisfaction ratings from the following agencies:

• Consumer Reports
• Better Business Bureau

The Best Company for You

Ultimately, who you choose to have your back is your choice and your choice only. Luckily, the car insurance industry doesn’t have a monopolizing company like Microsoft® or Duke Energy®.

So, you have options.

“Everything is worth what its purchaser will pay for it.”
– Publilius Syrus (1st century BC, Latin writer of maxims)

We all place value on things money can buy. Just because a car insurance company has the best rates, doesn’t mean you will truly value what they have (or don’t have) to offer.

In the table below, we have listed each company and the total number of discounts (advertised and/or confirmed), the highest percent discount, our opinion of what kind of customer it’s best for, and a link to our company review.

You be the judge.

How to Choose a Car Insurance Company

With so many options in car insurance companies and so many resources to judge which one is best for you, there are some key factors to consider before even getting a quote. Deciding between a small car insurance company or one of the largest companies often depends on your needs. Knowing when to buy car insurance is just as important!

For instance, small auto insurance companies sometimes operate under the control of the major insurers. Moreover, major insurance companies diversify their services towards all car owners.

Conversely, minor insurers normally target a specific type of drivers. Determining whether major auto insurance companies are better than smaller ones is dependent on a number of factors and preferences.

What you value in a car insurance company may go beyond who has the best price.

Here is a brief list of questions to consider. To get more details of the process, along with step-by-step instructions, read our more comprehensive article about choosing a car insurance company.

• Do I want to conduct business with an agent, a broker, directly with the provider, online, a national company, or a local company?
• What is the financial stability of each company, and what is their position for the future when it comes to market share, loss ratios, and third party rankings?
• Which company offers the best coverage and the most appropriate discounts and rates for my unique characteristics and needs?
• How satisfied are the customers of each company with its service and claims process?
• How many and what types of complaints have customers issued against each company?

Website, App, and Agents

We understand price is a huge influencing factor in which company you choose. We can’t possibly overlook your preferences in doing business.

Some companies are broker-/agent-based, meaning you must work with a human to purchase a policy. You certainly are permitted to support individuals making a living in your community.

Most independent brokers represent several insurance companies, so they can provide you with multiple quotes within a short period of time. Insurance brokers can also help you understand your insurance needs and they may make suggestions on ways to lower your rates.

Other shoppers prefer to cut out the middleman and go straight to the source. If you like handling everything online, working directly with a company may be best for you.

Each of the top 10 companies varies in the services they provide through their agents, website, and/or mobile app. Some companies have more strengths in their agents while others are almost entirely web- or app-based. Some of these services include:

JD Power provides, yet again, ratings of company services such as agents, call-center representatives, and websites. Take a look at these ratings, and keep in mind which business model you appreciate most.

Your Unique Characteristics

When you obtain a quote from a car insurance company, they will ask a series of questions, and the answers will lead them to generate your rate.

You may be wondering: what factors affect my rate?

The Big Nine

In most states, these nine factors will be used to determine how much you pay in premiums.

Insurance companies claim statistics show drivers with some of these characteristics as lower risk, but the numbers also make assumptions that are not always true about individual drivers.

And here they are:

1. Where you live – States (and sometimes cities) have specific laws about car insurance. This is the number-one factor in determining your rate.
2. Age – Insurance companies assume that, with more driving experience and maturity, we become safer drivers.
3. Gender – In some cases, rates for males are higher than females because of the assumption that men are more adventurous and risky.
4. Marital Status / Homeownership – Insurance companies consider being married and owning a home both signs of stability and responsibility, so they assume that married homeowners carry less risk.
5. Level of Education – Similar to marital status and homeownership, the assumption is that people with higher levels of education will also be more responsible and safer.
6. Vehicle Year, Make and Model – What you choose to drive makes a huge difference in your rate based on safety ratings, cost of repairs, and, sometimes, the amount of damage your vehicle can do to another car if in an accident.
7. Credit Score – Along with education, marital status, and homeownership, your credit score can reflect how responsible you are.
8. Driving Record – If you have a history of speeding tickets, accidents, or DUIs, you are considered a more risky driver and will pay higher rates in most cases.
9. Commute Distance – If you drive more, you statistically increase your chances of getting in an accident.

Okay, some of these factors make sense, but some of them may make you feel a little uncomfortable.

The good news is some states have outlawed some of the more discriminatory methods in calculating rates.

Here are a few examples:

• Determining rates based on gender has been outlawed in California, Hawaii, Massachusetts, Montana, Pennsylvania, North Carolina, and parts of Michigan.
• Montana was one of the first states (1985) to outlaw determining rates based on gender and marital status.
• California, Massachusetts, and Hawaii have outlawed using consumer credit information to determine rates.
• And, just recently, after decades of failed attempts at car insurance reform, a new law will go into effect July 2020 that prohibits insurance carriers in Michigan from determining rates based on anything but driving record, age, the vehicle you choose to drive, and possibly location.

Keep a close eye on your state legislation, because it may not be too long before other states follow in Michigan’s footsteps.

Discounts

Think about all the changes it’s possible to experience in one lifetime: college, marriage, affiliations, employment, etc. At each phase, a certain car insurance company may offer a discount based on the uniqueness of your situation.

Most of the higher-percent discounts provided are those granted when using a company’s usage-based driving app or specially designed equipment installed in your vehicle.

For example:

• American Family, Nationwide, State Farm, and Travelers offer their highest discounts when you use their usage-based programs.
• Geico offers its best discount for having airbags in your vehicle.
• Liberty Mutual provides a great discount if you sign up for vehicle recovery services.
• Allstate and Progressive choose to reward customers for having a good driving record when they sign on.

To learn in-depth details about the discounts offered by the top 10 insurance carriers, read our article about car insurance discounts.

Because laws and discounts both change, we have included data based on as many of these characteristics as we could to help you consider one of the top 10 car insurance companies in the nation.

The Top Car Insurance Companies in the Nation

Remember that war we referenced earlier?

Four companies (Allstate, Geico, Progressive, and State Farm) have dominated the car insurance industry for quite some time now. We looked as far back as possible on NAIC’s website (2004) and found something interesting.

In 2018, these four companies claimed over half the market share for the entire auto insurance industry, but it hasn’t always been that much.

In 2004, these four companies claimed only 41 percent; so, in a roughly 15-year period, they fought for and gained 10 percent from other companies in the top 10.

Comparing market share in 2004 and market share in 2018 shows who has won the battles and who might win the war.

Geico has grown the most over the last 15 years, followed by Progressive, while State Farm and Allstate have lost market share.

But, when you look at the period between 2013 and 2018, Geico is closing the gap in market share with State Farm, and Progressive is closing the gap in market share with Geico.

Currently, based on 2018 financials, State Farm is still well in the lead in total direct premiums written. Both Geico and Progressive have conquered Allstate in 2013 and 2017 respectively.

What sets these four leaders apart from one another? There are a few key differences:

• Allstate offers only an agent-based model.
• Geico offers internet-based policies dealing directly with the customers, and they also partner with investors.
• Progressive offers both agents and internet-based policies.
• State Farm is a mutual company and is owned by its customers, all shouldering risks and rewards equally.

It can’t be said which business model will win the war, but, as the consumer, you have options. Your unique needs and preferences will ultimately determine the best auto insurance company for you.

The Best Car Insurance Companies by Region

If you plan to move a state or two over, up, or down, these tables may be helpful. Sometimes when moving to a different state (even within the same region), your current carrier may not have the best auto insurance rates rates.

In some cases, neighboring states have such cheaper car insurance, it may be more feasible to move there and commute to work or ride the subway.

We’ve broken down the 50 states into regions so you can take a quick look at the average rate of your current (or future) insurance provider.

Midwest

There exists at least a $2,200 difference between the highest rate and the lowest rate per state. Some companies have a difference as much as $19,000, so it pays (literally) to shop around.

Northeast

For the Northeast, the difference between the highest rate and the lowest rate for each state is somewhere between $2,200 and $6,800, so the spread isn’t quite as wide as what the Midwest is experiencing.

Southeast

With 14 states, the Southeast is the largest region in the nation. The disparency between the highest and lowest rate isn’t quite as drastic as the Midwest, but it’s close. Drivers in the Southeast expect to pay a difference of up to $16,000, depending on which company they choose.

Southwest

The playing field is smaller in the Southwest; there are only four states. Their situation is similar to the Northeast. Drivers in the Southwest will see a difference between the highest rate and the lowest rate somewhere between $2,100 and $4,100, so that’s still worth the time to research and choose the best company for you.

West

Finally, we have the West; the most fortunate region in the US. There is only between $1,800 and $3,700 difference in rates, depending on the company chosen in each state.

Best Car Insurance Companies by State

The state in which you live has a huge influence on your rate. Every state is different, and it usually has a lot to do with the laws.

For example, one dividing factor between 11 states and the remaining 39 is whether or not their laws are at-fault-based or no-fault-based.

The difference has nothing to do with which driver is at fault in a car accident; no-fault law requires that policyholders turn to their own insurance company for claims, regardless of who is at fault in an accident.

Typically, no-fault states require drivers to purchase a certain amount of personal injury protection (PIP), which is elective in most at-fault states. Some states that are no-fault have outrageous rates, such as Michigan, New Jersey, and Florida.

Florida provides some options for its residents, but still requires a minimum of $10,000 in PIP. New Jersey also provides options in PIP coverage up to $250,000. However, Michigan currently requires drivers to pay for an unlimited amount of PIP coverage.

Take a look at the table below comparing Michigan, New Jersey, and Florida.

In 2015, Michigan car insurance companies had only 12 percent of the total PIP claims that Florida did, yet insurance companies were forced to pay out a billion dollars more in losses than Florida insurance companies.

Then there’s Louisiana, an at-fault state, with an entirely separate law permitting drivers to sue the insurance companies directly if its policyholder doesn’t have enough coverage for the damages and injuries after an accident. This one law, irrespective of being an at-fault state, results in higher rates due to an overcrowded court system and rampant insurance fraud.

Are you ready to see what laws influence car insurance rates in your state?

Best Car Insurance Companies and Rates

It’s not just the laws that affect your rates; many companies offer better and more affordable coverage depending on a multitude of other factors, as we covered previously.

The following tables show national level rates for the top 10 car insurance companies based on various demographics. All of these providers will provide quotes for free so make sure to enter your ZIP code in our quotes boxes to start comparing.

Let’s take a look at some of the best ranked car insurance companies!

Best Auto Insurance Companies and Rates for Males and Females

Some states have already outlawed car insurance premiums based on gender, and other states have now required a non-binary category when drivers obtain a quote.

We have removed teenage drivers from the table below since their age more heavily influences their rates rather than their gender.

All but two companies charge from $40 – $280 more to insure a male driver than a female driver. Progressive is just over a dollar difference, and Geico charges almost $24 more for females.

Best Auto Insurance Companies and Rates Single and Married

We have removed teenage drivers from the table below since their age more heavily influences their rates rather than their marital status.

If you are single, then Geico, Travelers, and USAA will provide the best rates. If you are married, then Allstate, American Family, and Farmers will provide the best rates.

Interestingly, not all companies give married couples a break. Drivers that get married while holding a policy with State Farm, Travelers, and USAA will see an increase in car insurance premiums.

Geico and State Farm both have very similar rates for single and married people, with a difference as little as $29.

Best Auto Insurance Companies for Teens

On a national level, Geico, Nationwide, and USAA are some of the best companies for teen drivers, since they charge the least for their rates.. For teens, in particular, collision coverage would be good to consider, even if their vehicle is not financed.

This kind of coverage for teens may be a better option since there may be times when liability simply will not be enough. If your teen is found guilty of causing the accident, their liability coverage does not apply in certain areas.

If their car is damaged, your teen will need to find the means to repair their car themselves. This is when collision comes in handy. Collision coverage is when the auto insurance provider pays. When your teen is involved in an accident, they receive compensation.

It does not matter if the accident was his or her fault or caused by another driver. This can sometimes be the best level of coverage for very inexperienced drivers.

While your teen gains a level of comfort behind the wheel, they may cause damage. It may be mild, moderate, or severe. Unfortunately, this is how many learn to gauge distance and avoid obstacles in the road.

For example, if your teen is driving in a parking lot and crashes into a parked car they are responsible. The same is true if they back out without looking first and another vehicle is in their path.

Liability will repair the damages done to the other vehicle, but your teen’s car will also need repairs. Collision can pay for a fender bender quickly and get them back on the road.

Best Auto Insurance Companies for Those in Their 20s and 30s

On a national level, Geico, Travelers, and USAA charge the least for covering single drivers in their mid-20s to mid-30s.

Best Auto Insurance Companies for Those in Their 30s through 50s

On a national level, State Farm, Travelers, and USAA charge the least for covering married drivers in their mid-30s until age 60.

Best Auto Insurance Companies for Those in Their 60s

On a national level, American Family, State Farm, and USAA charge the least for covering drivers 60 and older.

Best Auto Insurance Companies and Rates by Vehicle Type

On a national level, Geico, State Farm, and USAA charge the least for used and new sedans and used SUVs and trucks. However, the companies that provide the best rates for a new SUV and a new truck are Geico, Nationwide, and USAA.

Best Auto Insurance Companies and Rates by Credit Score

Your credit reports and score will shed some light on your payment history on the various financial commitments you have made. One company that provides credit reports explains how the ranges in score determine your creditworthiness.

Some insurance companies rely heavily on your credit score to determine your rate, while others may rely more heavily on other factors.

You will have a rate based on your credit score when you purchase your first policy, and this rate may change in the future if your credit score dips. For this reason, we have looked at the jump in rate going from good credit to fair credit and fair credit to poor credit.

Farmers, Progressive, and Travelers are the most forgiving of drivers that move from a good credit score to a fair credit score. Progressive, Nationwide, and Travelers are the most forgiving of drivers that move from a fair credit score to a poor credit score.

Best Auto Insurance Companies and Rates by Driving Record

If there’s one factor that insurance companies can use in determining rates that is non-discriminatory, it’s your driving record. A licensed insurance agent explains it well in this video:

When you purchase your first six-month policy, you will have a rate based on your driving record at the time the policy is written. If you already have a driving record with a speeding ticket, American Family, Geico, or USAA are the best bets. Geico, State Farm, and USAA have better rates for those with an accident, and Progressive, State Farm, and USAA have better rates for those with a DUI.

We also take a look at the jump in rate if you have a clean driving record and are issued any of the three infractions:

• Going from a clean record to having one speeding ticket on your record, the companies that have the lowest jump in rates are American Family, State Farm, and USAA.
• Going from a clean record to having one accident on your record, the companies that have the lowest jump in rates are Nationwide, State Farm, and USAA.
• Going from a clean record to having one DUI on your record, the companies that have the lowest jump in rates are Progressive, State Farm, and Farmers.

Best Auto Insurance Companies and Rates by Commute

In the case of commute distance, a shorter commute is considered 10 miles or 6,000 miles per year. A long commute is considered 25 miles or 12,000 miles per year.

Farmers, Progressive, and Nationwide have the smallest rate jump (less than $30) between a short commute and a long commute.

Best Auto Insurance Companies and Rates by Coverage Level

You may be asking yourself: Should I try to find affordable auto insurance or the best coverage?

After an accident occurs, the policyholder with insufficient coverage will have to pay for losses above the payout limits. This is a spot in which you do not want to be.

The Insurance Institute for Highway Safety tracks all accident and repair statistics. A visit to the website will reveal the perceived risk of driving each vehicle make and model. Some vehicles do not perform well in crashes. Expensive vehicles cost more to repair or replace, and the insurance companies charge more to insure them.

Coverage level refers to the difference in cost of coverage based on the minimum requirements (low coverage), slightly above the minimum (medium coverage), and well above the minimum (high coverage).

In a few words, coverage level translates to “cover your assets.”

“When the bank asks me about my assets, I include my friendship with Regis Philbin.”
– Lou Holtz, former American football player, coach, and analyst

Check out this couple explaining the return on investment in choosing coverage levels for each type of coverage. Note that they live in Florida and have a policy with Geico, so your situation may be different if you live in a different state or have a different provider.

American Family, Nationwide, and USAA provide the most bang for your buck when it comes to coverage, whether you are going from low to medium coverage, medium to high coverage, or low to high coverage.

The Bottom Line

Now you have a comprehensive understanding of all the factors that determine your rates from the top 10 car insurance providers in the nation. Remember, the major influential factor is where you live, because ultimately, both you and your car insurance carrier must obey the laws in your state.

Are you ready to choose a company to have your back?

If we missed anything you want to know about the top 10 car insurance companies, let us know in the comments below.

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