Pros and Cons of the Best Car Insurance Companies [2023]

American Family

American Family Insurance, commonly shortened to AmFam, was established in 1927 in Madison, Wisconsin. The company began by only providing auto insurance, specifically targeting its policies toward America's large population of farmers. The reasoning behind this was that they believed farmers were at a lower risk of getting into accidents, as they tended to only drive in the countryside and rarely in the city.

Pros and Cons of American Family Insurance

Pros:

• Rates for drivers with a DUI in the past or teen drivers, who both tend to pay significantly higher premiums, are lower than the national average.
• Drivers with poor credit tend to pay more for insurance and can pay lower-than-average rates.

Cons:

• Poor reviews for customer service and difficulty handling claims
• Low-renewal rates, a significant number of customers seek policies elsewhere after expiration

AAA

The American Automobile Association, or AAA, was created in 1902 in Chicago, Illinois, and is currently headquartered in Heathrow, Florida. The company is well known for its roadside assistance program, which provides emergency road services to its members. These services include towing, winching, tire changes, battery replacements, jumpstarts, and automotive first aid. The program also extends to motorcycles and bicycles in certain areas, contracting out their road services to local towing companies outside of large metro areas.

Pros and Cons of AAA Insurance

Pros:

• AAA offers a variety of discounts to help make their premiums more affordable, as well as several policy bundles
• Roadside assistance programs are incredibly reliable, especially in metro areas where AAA customers have the company's personal fleet at their disposal.

Cons:

• Besides teen drivers, AAA is the most expensive option for most demographics. The company also consistently receives low scores for claims handling and customer service.
• Outside of metro areas, AAA outsources its roadside assistance to local towing companies. This makes the service you'll receive in rural areas hit or miss depending on who is available.

Progressive

The Progressive Corporation, known commonly as Progressive, was founded in 1937 and headquartered in Mayfield Village, Ohio. In addition to automobile policies, Progressive provides life, home, pet, and various other types of insurance to their customers. The company initially found success by offering a niche service: insurance for riskier drivers. Progressive also claims to be the first auto insurance company to create a website, becoming early adopters of services that allow customers to purchase their policies online.

Pros and Cons of Progressive Auto Insurance:

Pros:

• Progressive offers lower-than-average rates in certain high-premium states, including California and New York.
• Drivers who've been charged with DUI, who usually experience a massive rate increase, have competitive rate options through Progressive.

Cons:

• Progressive charges some of the highest rates out of insurance companies for teen drivers. They statistically have a higher chance of getting in an accident and filing a claim.
• The company has suffered from low customer loyalty scores for years, with many customers switching over for better savings elsewhere.

Travelers

The Travelers Companies Incorporated, or Travelers, was founded in 1853 as the St. Paul Fire & Marine Insurance Company. Changing its name in 2004 and currently headquartered in New York City, Travelers is the sixth-largest writer of U.S. personal insurance through independent agents.

Pros and Cons of Travelers Auto Insurance

Pros:

• One of if not the best claims handlers, customer survey data consistently ranks Travelers #1 for their ability to handle claims.
• Monthly premiums are lower than the national average.

Cons:

• Surveys of policyholders frequently show complaints about Traveler's customer service.
• Compared to other insurers, Traveler's policyholders are less likely to recommend the service to friends and family.

Allstate

The Allstate Corporation, originally part of Sears, Roebuck, and Co., was founded in 1931. The company separated partially from Sears in 1993 and became its own independent entity in 1995. Allstate is most well known for its slogan, "Are you in good hands"? which has been featured prominently in its advertising campaigns since 1950.

Pros and Cons of Allstate Auto Insurance:

Pros:

• Customer surveys consistently show that Allstate has a simple and easy-to-use claims filing system.
• Allstate has a highly-rated customer service team that outperforms many of its competitors.

Cons:

• Despite the praise for their claims filing and customer service, Allstate has low policy renewal rates.
• Allstate also charges higher premiums than many of its competitors, with higher-than-average rates overall.

Geico

The Government Employees Insurance Company, or GEICO for short, was founded in 1936 and is currently headquartered in Chevy Chase, Maryland. GEICO is the second-largest auto insurer in the United States and is well known for its various advertising campaigns. These usually include the slogan "15 minutes could save you 15% or more on your car insurance", being spoken by characters like the GEICO Gecko, Geico Caveman, and various other one-off ads.

Pros and Cons of Geico Insurance:

Pros:

• GEICO has very low rates, with many surveys showing them as the second-lowest compared to competing companies.
• GEICO is an excellent choice for drivers with poor credit, offering the lowest rates of any insurer.

Cons:

• The company is one of the worst choices for those with a DUI, charging higher-than-average rates.
• While not the worst, GEICO has a lower-rated customer service team than other insurers.

Nationwide

National Mutual Insurance Company, known commonly as Nationwide, was initially founded in 1926 as Farm Bureau Mutual. Well known for its easily-recognized jingle "Nationwide is on your side", the company has had many famous representatives, including Peyton Manning, Brad Paisley, and Julia Roberts.

Pros and Cons of Nationwide Auto Insurance

Pros:

• Many customers stay with Nationwide, giving them high levels of customer loyalty.
• Customers also report having excellent interactions with representatives, giving Nationwide high marks for claims handling and customer service.

Cons:

• For drivers with a DUI conviction, Nationwide charges higher-than-average rates.
• Nationwide's base-level coverage is more expensive (on average) than its competitors.

Farmers

Farmers insurance group, or Farmers, was founded in 1928 in Los Angeles, California. Similar to American Families, Farmers believed that drivers in farming communities were better drivers and, therefore, a more lucrative demographic to insure. While much more highly rated now, Farmers did experience a significant controversy in 2006 when they received the highest number of complaints to state insurance departments in Oregon and Washington.

Pros and Cons of Farmers Auto Insurance:

Pros:

• Despite their past controversy, Farmers now receives consistently high marks for their customer service.
• Customer surveys frequently find that Farmers have efficient claims handling.

Cons:

• The premium rates for Farmers' insurance are above the national average.
• Likely due to high rates, customers renew less often, opting to switch to cheaper insurance options.

State Farm

State Farm Insurance, headquartered in Bloomington, Illinois, was founded in 1922. They are not only the largest auto insurance provider in the United States but also the largest provider of property and casualty insurance. They sponsor numerous sports arenas in the country, including State Farm Stadium in Arizona, State Farm Arena in Atlanta, and State Farm Center in Illinois.

Pros and Cons of State Farm Insurance:

Pros:

• State Farm has some of the highest policy renewal rates and customer service ratings.
• State farm consistently charges lower rates than its competitors for most demographics, except for those with poor credit.

Cons:

• Drivers with poor credit tend to pay higher-than-average rates.
• State Farm auto insurance isn't available to drivers in Massachusetts or Rhode Island.

USAA

Consistently the highest-rated insurance company, the United States Automobile Association (or USAA) was founded in 1922 in San Antonio, Texas. Starting as the United States Army Automobile Association, USAA is credited with pioneering direct marketing, involving agents reaching out to consumers directly through the telephone (and later, the internet). While highly rated, USAA is only available to military members, honorably discharged veterans, or family members of military members.

Pros and Cons of USAA Auto Insurance:

Pros:

• USAA offers cheaper rates than many of its competitors for almost every demographic.
• The company consistently receives high marks for its customer service, beating most of its competitors.

Cons:

• Only USAA members can access their auto insurance; to become a USAA member, you must be a current or former member of the military (or someone in their immediate family).
• USAA has limited local branches, making it difficult to engage in in-person banking

Whether you are buying a car insurance policy or looking for a used car, make sure to do ample research beforehand. How much car insurance you pay, regardless of the company you choose, could skyrocket if you choose the wrong vehicle. Tools like vehicle history reports can help you see essential details about a car's past, including its accident history, number of previous owners, and whether it's undergone any title changes. This information can be invaluable if you intend to pay the lowest possible premiums on your insurance; if a vehicle had a sketchy history before you owned it, you could end up paying hundreds or thousands more a year.