Most of us need car insurance, but we don't always know the best place to get it or even the difference between one provider and another. According to data from financial research firm A.M. Best, about 50 percent of the U.S. auto insurance market is controlled by just four major companies: Allstate, Geico, Progressive and State Farm. If you watch TV or pay attention to billboards, you have almost certainly seen advertisements from these four giants on a regular basis. But just because you remember their name or can recite their jingle, it doesn't necessarily mean they have the right insurance policy for you.
NerdWallet, a personal finance news and advice website, crunched the numbers and read reviews for each of these major car insurance providers to determine the strengths and weaknesses of each. They compared each company based on coverage price as well as customer satisfaction, product range and the technology available to customers. As it turned out, the Big Four each had their own selling points depending on what you are looking for.
Best overall value
Based on price and customer satisfaction, NerdWallet rated Geico at the top. While it is actually in second place in terms of market share (State Farm owns the most policies), Geico's lower-than-average rate of complaints and useful tech features made it the most attractive option for the price, according to NerdWallet. Not only are customers apparently happier with Geico than the other large insurers, the firm also tended to offer the lowest price of the Big Four. However, NerdWallet noted that insurance price comparisons are extremely hard to accurately report, since premiums and total cost vary depending on a huge number of individual factors. That's why it's always a good idea to shop around for the policy that's the best deal for you specifically, not the general population.
More coverage options
Geico might not be the best fit if you want more versatility in coverage options, either. NerdWallet ranked Progressive as the one with the most unique coverage options available out of the Big Four. That's because Progressive sells policies covering a host of other vehicles including boats, recreational vehicles, snowmobiles and even Segways. For typical auto insurance customers, it may even offer add-ons like pet injury coverage, roadside assistance, custom equipment coverage and others. The primary drawback on Progressive cited by NerdWallet was that its customer satisfaction ratings, as judged by third-party analysts like J.D. Power, were about average.
If technology and innovation appeals to you the most, NerdWallet ranked Allstate as the best pick. For example, Allstate members can often submit damage claims with video and photos through a mobile app, which makes appraisal faster and easier. On each ranking related to customer satisfaction, J.D. Power found Allstate to be "about average," and the company had fewer than the median number of complaints against it in 2016, according to the National Association of Insurance Commissioners.
The best and the rest
So what about State Farm, the largest auto insurance provider in the U.S.? NerdWallet ranked it last out of the Big Four, primarily due to customer complaints. According to the NAIC, U.S. consumers made more complaints about State Farm to their state's insurance regulation authority than the average for a company of its size in 2016. However, customer satisfaction scores were about average, and State Farm's size means it is available to a large number of people at different price points. State Farm is also a major carrier of homeowners and life insurance policies, and bundling multiple types of coverage together is often cheaper than purchasing each individually. If you're already a State Farm customer and you're satisfied, you could be in for a good deal on auto insurance.
The Big Four insurance providers might represent half of all auto policies in the U.S., but that doesn't mean they will provide the best deal for any individual. There are hundreds of smaller but still reputable auto insurance providers out there that can meet or exceed your expectations, whether it's your first policy or you are switching from one of the industry leaders. Once again, preparation and diligent research is the key to finding a policy that doesn't cut corners on quality, but still delivers savings.
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