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In early 2018, Clearsurance published its first annual list of the top rated car insurance companies based on just under 40,000 consumer reviews left on Clearsurance during 2017 (Clearsurance was only launched in late 2016). Several of the companies that made this list were brands many consumers likely hadn’t heard of — the primary reasons being these companies don’t offer coverage nationally and/or they don’t have the large advertising budgets of the household brands. At that time, we hadn’t published state rankings car insurance pages, so we weren’t sharing how these companies performed on a state by state basis, only how they ranked overall.
For context, let’s review our list from early this year of the best car insurance companies for 2018 based on consumer reviews.
| Rank | Best car insurance company |
|---|---|
| 1 | NJM Insurance Group |
| 2 | USAA |
| 3 | Amica Mutual Insurance Company |
| 4 | Shelter Mutual Insurance Company |
| 5 | Erie Insurance Group |
| 6 | Auto-Owners Insurance Group |
| 7 | AAA |
| 8 | The Hartford |
| 9 | Geico |
| 10 | American Family Insurance |
Flash forward to today and Clearsurance has now curated over 125,000 consumer reviews, and more than half of the same companies identified as top performers during 2017 are still on top according to consumers on our site. In addition, these companies are not just the most highly rated in one or two states where they offer coverage but in all, or nearly all, of the states where they sell car insurance.
We recently reviewed all of the consumer feedback for these, and other companies, that perform well on a state by state basis to create a current list of the top rated car insurance companies. As you’ll see, USAA, Amica, Shelter Mutual, Erie Insurance and Auto-Owners all continue to shine. In addition, American National, Grinnell Mutual, The Cincinnati Insurance Company, Ameriprise Auto & Home Insurance and California Casualty all make the top rated list, based on feedback from their policyholders. Of all these companies, the brand that is likely known to all of us is USAA because its a national company and one that advertises in mainstream media. However, the others, for the most part, may not be brands you’ve heard of.
The table below shows how often these companies rank as one of the 10 best car insurance companies in the states where they write coverage. We’ve also included the number of states where they offer car insurance for your reference.
Top rated companies
| Car insurance company | % of states | # of states & D.C. |
|---|---|---|
| USAA | 100% | 51 |
| Amica Mutual Insurance Company | 100% | 50 |
| Ameriprise Auto & Home Insurance | 100% | 44 |
| American National Insurance Company (ANPAC) | 100% | 32 |
| The Cincinnati Insurance Company | 100% | 42 |
| Auto-Owners Insurance Group | 100% | 26 |
| Shelter Mutual Insurance Company | 100% | 15 |
| Grinnell Mutual | 100% | 11 |
| California Casualty Group | 90% | 44 |
| Erie Insurance Group | 90% | 13 |
Now compare this list to the most well-known car insurance companies — household brands that we’ve all heard of like Geico, State Farm, Progressive, Allstate and Nationwide. For these companies, we know their mascots, slogans, jingles and spokespeople. We see their ads on TV, hear them on the radio and they’re very visible when searching for car insurance online.
While these companies are easily recognized, as you’ll see in the table below, these household brand companies rarely, if ever, are ranked as a top 10 car insurer in the states where they offer coverage. As a matter of fact, four of these companies don’t show up in the top 10 for a state even once.
Household brands
| Car insurance company | % of states | # of states & D.C. |
|---|---|---|
| Geico | 16% | 51 |
| State Farm | 10% | 51 |
| Progressive | 4% | 51 |
| Nationwide | 4% | 50 |
| Travelers | 4% | 47 |
| Safeco | 4% | 45 |
| Allstate | 0% | 51 |
| Liberty Mutual | 0% | 51 |
| Esurance | 0% | 43 |
| Farmers Insurance Group | 0% | 38 |
So why do consumers rate these companies the way they do? How can companies that have such a large share of the car insurance market not be rated as highly as those that don’t?
We set out to better understand the main reasons for these results and here’s what we discovered. For each of the attributes we collect customer feedback on, the top rated companies outperformed the household brands. For example, the aggregate scores for likelihood to recommend and likelihood to renew coverage for the top rated companies are much higher than the aggregate scores for the household brands. The same is true for the buying process and claim service.
In addition, here are some themes that emerged from the written customer feedback we’ve received on Clearsurance on the companies listed above.
| Top Rated - Terms most associated with these companies | Household brands - Terms most associated with these companies |
|---|---|
| Customer service | Price/cost savings |
| Buying & renewal process | Online services |
| Peace of mind | Easy to work with |
| More loyalty | More shoppers |
| Helpful | Rate increases |
Other factors to consider
In addition to the customer feedback on the top rated companies, we’ve identified some additional factors we believe set the top rated companies apart from the household brands.
- Top rated companies are more likely to be ones that are membership or affinity driven, meaning they sell to a very targeted audience of consumers. For example, USAA sells to military personnel and their families, and California Casualty focuses on municipal workers and healthcare professionals.
- Several of the top rated companies are mutual companies, which tend to be more focused on their policyholders than their shareholders, therefore more service oriented.
- The top rated companies have more loyal customers, and therefore more promoters or advocates. Their customers are more likely to tell their friends and family about how satisfied they are with their insurance company.
For the companies recognized as household brands, we’ve noticed the following similarities.
- Most of these companies are publicly traded and are growth focused.
- Car insurance rates tend to be lower for these companies initially, but they deploy more aggressive rate increases in subsequent years.
- These larger companies have more sophisticated technology solutions, and their customers value the ease in doing business with them.
While policyholders of the household brands have shared some positive feedback on their experiences, these positive sentiments don’t change the fact that their customers are less loyal based on consumer feedback. Our data shows that nearly a quarter (24 percent) of household brand customers plan to shop or leave at their next renewal compared to only 13 percent of customers of the top rated companies. These brands succeed because of the law of large numbers. Even though their customers say they’re more likely to shop, their ease of use may in fact help them keep their customers.
Lesson learned
The next time you’re shopping for car insurance, it’s worth spending some time looking at companies that you may never have heard of before if the feedback from their customers is positive.. We encourage all consumers to read reviews on Clearsurance to better understand the positives and negatives of any company before making a decision. After all, don’t you do the same thing before making other purchases?
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