Drivers must procure liability auto insurance before their cars can be taken out on the road. The consequences for not having it are steep: fines and suspension of your driver’s license. To add insult to injury, auto insurance providers are likely to raise your rates if you are caught driving without insurance, as the lack of responsibility suggests risky behavior behind the wheel.
Comprehensive and collision insurances, on the other hand, are not a required cost of car ownership.
Liability insurance covers expenses for the other driver when you’re at fault in an accident. Comprehensive pays for costs associated with stolen or damaged cars, outside of an accident. Collision insurance covers damage to your vehicle caused by contact with another vehicle or object. Most drivers purchase both of the additional plans. According to an Insurance Information Institute study, 77 percent of insured drivers purchase comprehensive coverage and 72 percent carry collision insurance.
What are your best options when shopping for coverage? First of all, compare rates every couple of years, since your coverage needs and credit scores change, and because insurers generally update their prices every six to 12 months. And don’t stop at just checking with two or three companies; the deeper you dig, the more likely you are to turn up savings.
This is important for your wallet, as car insurance is a major expense for most people. According to a 2016 Car Insurance Buying Guide from Consumer Reports, it costs a single person about $9,000 to $14,000 over 10 years to insure one car. Smart shopping can save that same individual $4,000 to $6,200.
But savings are not simply a matter of finding the lowest premium. Picking the wrong insurer can cost you a pretty penny as well. Consider that some providers may lowball repair estimates or push repair shops to cut corners while simultaneously asking you to pay extra for original manufacturer parts. And some insurers may unfairly raise your premiums after an accident.
That’s why it’s important to check into auto insurers’ reputations and performance.
Consumer Reports surveyed nearly 65,000 subscribers who filed claims between 2011 and 2014. It found that 88 percent of them were “highly satisfied” with the handling of their claims. Among the highest-rated providers were USAA, Amica Mutual and NJM Insurance, with overall satisfaction ratings of 90 or higher on a scale of 100. The three insurers have consistently earned high ratings from Consumer Reports since 1999.
Results from Insure.com’s annual customer survey of car insurance companies for 2016 follows. Customers were queried on pricing, customer service, handling of claims, whether they would recommend the company to a friend, and whether they plan to renew their current policy:
- CSAA Insurance Group: For AAA members only, CSAA received the top rating with an overall satisfaction score of 90.4.
- USAA: 87.5
- State Farm: 87.2
- Erie Insurance: 87.1
- The Hartford: 86.2
- The General Insurance: 85.9
- Geico: 85.7
- Nationwide: 84.5
- MetLife: 84.3
- Allstate: 82.6
- Liberty Mutual: 82.1
- Titan Insurance: 82
Not to be outdone, J.D. Power conducts its own consumer study, which rates insurance providers based on how satisfied customers are with the handling of their most recent claims. According to its 2015 survey, Auto-Owners Insurance ranks highest with a score of 893—on a 1,000 point scale. Amica Mutual ranks second with 885 points, followed by Auto Club of Southern California Insurance Group (871), The Hartford (870) and Nationwide (866).
When choosing the best auto insurance company for yourself, start by using these and other rankings as well as checking financial standings and comparing quotes. Ideally, you want a provider that offers great coverage at an affordable price from customer-service–oriented agents.
Here are some tips when comparing:
- Check with your family and friends about their preferred providers.
- Look for discounts and good-driver rewards programs.
- Ask about bundling insurance policies.
Keep in mind as you collect quotes that the single greatest factor influencing the process is claim frequency—not how many claims you make (though that has an effect), but, rather, how frequently an insured event occurs within a group relative to the number of policies in that group. Consequently, individuals in high claims groups will be charged more.
Additional factors that affect your rate include your driving record, your geographic territory, your gender and age, vehicle usage, car make and model, and even your marital status.