If you follow my advice, by getting price quotes from all the leading auto & home insurance companies each year, to make sure you pay reasonable rates, and get additional opinions on your coverage, you will see some companies charge more than double the amount other companies charge. This is how you can save hundreds of dollars by shopping your insurance. But some people have a reluctance to change to companies with substantially lower rates, thinking you get what you pay for. The good news is, unlike a lot of products, where you get better quality by paying more, you don’t get better service by paying more for insurance. My blog post today will discuss the JD Power 2012 US auto claims satisfaction ratings for all the major car insurance companies, and tell you what you need to know to find a company with acceptable claims satisfaction, and low rates for you.
Some companies, with high auto claims satisfaction scores in this JD Power study, have much lower insurance rates for some customers in some states, than other companies charging much more for the same coverage, scoring average or less than average in this study for auto claims satisfaction.
Yet almost all companies, regardless of their claims satisfaction scores, save some people a lot of money on their insurance. The only way to find the company having low rates for you is to shop with as many different companies as you can.
However, once you find the companies with the best car or home insurance rates for you, how do you know which ones provide acceptable customer service?
You can ask your friends, family, & neighbors for their opinion. But asking even as many as one hundred or two hundred people is still not a large enough sample to be reliable, much less asking a smaller group of your friends & family. This is why I like the annual JD Power insurance studies, as an additional resource to help me evaluate the customer service for an insurance company.
I think the most important JD Power study for auto insurance is their annual survey regarding auto insurance claims satisfaction. The JD Power US Auto Claims Satisfaction Study is based on responses from more than 12,508 auto insurance customers settling an auto insurance physical damage claim (damage to the car insured by the customer) in the last 6 months.
An auto insurance company may have low rates for you, great coverage options, and a friendly & helpful agent always there to answer your questions and assist you. But, what if you have a claim, and the company’s claims representative is slow to respond, does not investigate or pay your claim in a timely fashion, or does not give you a fair settlement? You may change your mind about the quality of your insurance company. A lot of people are happy with their insurance company until they have a large claim.
Every company has some people unhappy with how a claim was handled. You can have an excellent or poor experience with any insurance company. But some companies do a better job of keeping more of their customers satisfied when a claim occurs. Using the annual JD Power auto claims satisfaction study, to review the quality of the leading insurance companies each year, keeps you informed, and can help you reduce the chance you’ll have a disappointing claims experience, by choosing to insure with one of the higher rated companies.
However, you need to look beyond the power circle rating system to know which companies really have superior or inferior claims satisfaction. Some companies, rated above average with 4 or 5 power circles, actually scored much closer to average than some other top-rated companies.
The power circle rating is determined by a company’s point score on a 1,000 point scale.
For example, Allstate auto insurance scored 863 out of 1,000 points in the study, and rated 4 power circles (better than most) for Overall Auto Claims Satisfaction. Travelers scored 857 out of 1,000 points, only 6 points less on the 1,000 point scale (a .006 difference), but rated 3 power circles (about average) for Overall Auto Claims Satisfaction. Allstate is rated better than most, but it scored only 11 points more (1.1% higher) than the study average score. Allstate’s rating of 4 power circles implies superior auto claims service, but its score is close enough to average, where I think the expectation of superior service is a false expectation.
This blog post analyzes the study scores, from the highest scoring company to the lowest scoring company, and looks at each company’s ratings for factors considered, like First Notice of Loss, Service Interaction, Appraisal, Repair Process, Rental Car Experience, & Settlement.
The information I provide will help you avoid thinking it might be worth paying more for a company rated better than most, or among the best, with 4 or 5 power circles, when its actual claims satisfaction score is not far from average. Or, let you know if a top rated company’s score is very close to another company with a lower power circle rating, which you may want to choose over the higher rated company, because it has a much better price for you. Also, my analysis will help you decide if you really need to change auto insurance companies, if your company has an average or lower rating in this study.
Not all the companies on this list sell car insurance in every state. Not everyone will qualify for every company, based on driving record of the drivers in your household, or other factors. If you have trouble qualifying for auto insurance, I mark companies more likely to insure most drivers with an asterisk (*).
JD Power 2012 US Auto Insurance Claims Satisfaction Study: 28 Major Companies ranked from Best to Worst for Overall Auto Claims Satisfaction
1,000 points is a perfect score.
The first four companies received the highest numerical scores in the study, and also received the highest rating of 5 power circles in the category of Settlement. I believe satisfaction with the amount of the claims settlement is the most important element of the claims process. A company can be among the best for Service Interaction (How well the claims representative communicates with you) or the Repair Process, but if what they pay you for the claim is less than you expect, those other factors do not matter much. A 5 power circle rating for the category of Settlement is a good indication the company is meeting or exceeding customer expectations in paying claims.
Although the highest scoring company, New Jersey Manufacturers, is only 44 points higher than the study average on the 1,000 point scale, which is not greatly out-performing the average rated companies (Think of it as NJM scoring 89.6%, or a “B+/A-,” on a pop quiz, where the average company scored 85.2%, or a solid “B.”), I think any of these four companies would be worth paying more, if they don’t have the lowest rate for the same amount of coverage, as a company scoring about average (Companies ranked 12-19 on this list) or lower in this study.
1. New Jersey Manufacturers auto insurance — 896 points. NJM rated 5 power circles (among the best) for all factors, except for Service Interaction, which received a 4 power circle rating (better than most).
However, if you want to insure with NJ Manufacturers, it has restricted eligibility, and is only available in the states of New Jersey and Pennsylvania. Your employer needs to be a New Jersey Business & Industry Association member, or you need to be a State of New Jersey employee, to be considered. Contact your employer to see if NJM is available to you.
2. USAA auto insurance — 889 points. Scoring only 7 points on the 1,000 point scale below NJM, USAA rated 5 power circles — among the best — for the categories of First Notice of Loss (Your initial report of the claim to your insurance company), Appraisal (appraising the car’s damage and cost of repair), and the very important category of Settlement. It rated about average (3 power circles) for Service Interaction, the Repair Process, and the Rental Car experience. It’s surprising to have a company rated among the best for Overall Auto Claims Satisfaction, like USAA, receive an about average rating for three categories.
Unfortunately, like NJM, USAA is not available to everyone. You must be in the military, an immediate family member of someone in the military, or an honorably discharged veteran, to be eligible for USAA.
3. Auto-Owners auto insurance — 887 points. Auto Owners scored only two points below USAA, and 9 points below, on the 1,000 point scale, the highest scoring company, NJ Manufacturers. Unlike USAA & NJM, Auto Owners is sold through local independent insurance agents, so you can get personal service and the over-sight from an agent, as well as highly rated auto claims service. Since Auto Owners does not have restricted eligibility, like NJM & USAA, it is the Award Winner (highest scoring company available to the general public) of the study.
Auto-owners rated either among the best (5 power circles) or better than most in all categories, except the Rental Car Experience, which received the lowest rating of 2 power circles. It’s unusual for such a high scoring company to have any category receiving the lowest rating.
Coverage to pay for a rental car is optional coverage not everyone chooses to purchase. However, if you would need to rent a car, if any of your cars were unavailable or not drivable because of a covered physical damage claim, the optional coverage may be something you need. If you are interested in purchasing car insurance from Auto-Owners, be sure to ask your agent about how a car rental will be handled by the company, and what you can do to avoid problems, if you need to use this coverage.
4. Amica auto insurance — 876 points. 20 points on the 1,000 point scale below the highest scoring company, Amica received a 4 power circle rating for Overall Auto Claims Satisfaction, instead of the 5 power circle rating received by the top three companies. However, like the three top companies, Amica received a 5 power circle rating for the most important category of Settlement.
Amica scored only 11 points (on the 1,000 point scale) less than Auto Owners, but Amica received a 3 power circle rating (about average) for the Rental Car Experience, which was higher than the 2 power circle rating (the rest) for Auto Owners in this category. Amica also rated about average for the Repair Process, but rated above average in all the remaining categories.
Amica does not use local agents, and sells directly from the company, like USAA, NJM, Progressive & GEICO. However, Amica may be a better choice for you than Auto Owners, depending on price, the coverage options they can offer you, or how important the Rental Car Experience is for you.
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The next seven companies may be a better choice for you if they have a better price and/or coverage & policy options. They all received a 4 power circle rating (better than most) for Overall Auto Claims Satisfaction, and the important category of Settlement. The lowest scoring of these seven companies is only 13 points out of 1,000 less than the fourth ranked company, Amica auto insurance.
If, for some reason, none of the companies ranked 1-4 have a competitive rate for you, these next seven companies may have a better price for you, but still provide above average auto claims service.
I note, for each one of these seven companies, how many of the six factors (categories or elements of the overall claims process) of First Notice of Loss, Service Interaction, Appraisal, Repair Process, Rental Car Experience, & Settlement, were rated at about average or lower. Depending on pricing & coverage, you may want to choose one of the next seven companies with a lower number of categories rated at or below average.
5. Erie auto insurance — 876 points. Erie ties Amica with the same point score. The most significant difference is Amica rated 5 power circles (among the best) in the category of Settlement, where Erie rated 4 power circles (better than most). Erie rated among the best for the Repair Process, while Amica rated only about average. The only category Erie rated about average (3 power circles) was the Rental Car Experience. Erie also has the advantage of having a local independent agent to assist you.
Number of categories/factors rated at about average or lower: 1
6. Auto Club of Southern California auto insurance — 874 points. Only 2 points below Erie, Auto Club rated better than most in all categories except Service Interaction, the Appraisal Process, & the Repair Process, which rated about average.
Number of categories/factors rated at about average or lower: 3
7. Country auto insurance — 874 points. Country has a tie score with Auto Club of Southern California. However, Country rated above average, with 4 power circles (better than most) or 5 power circles (among the best) in all categories. Unfortunately, Country is available only in Alaska, Arizona, Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Nevada, North Dakota, Oklahoma, Oregon, Wisconsin, and Washington.
Number of categories/factors rated at about average or lower: zero (0)
*8. American Family auto insurance — 869 points. Only 5 points below Country & Auto Club of Southern California, American Family rated better than most in all categories, except the Repair Process & the Rental Car Experience, where it received a 3 power circle rating, or about average, for these two categories.
American Family is available through local agents in Arizona, Colorado, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Minnesota, Missouri, Nebraska, Nevada, North Dakota, Ohio, Oregon, South Dakota, Utah, Washington and Wisconsin.
Number of categories/factors rated at about average or lower: 2
9. The Hartford auto insurance — 868 points. One point below American Family, The Hartford is still 16 points above the study average score. However, Hartford is only the second company so far on this list to receive the lowest rating of 2 power circles (the rest) for a category. Like Auto Owners, Hartford received a 2 power circle rating for the Car Rental Experience. The Hartford rated about average for Service Interaction and the Appraisal Process. For First Notice of Loss and Settlement, Hartford rated 4 power circles (better than most). For the Repair Process, Hartford received the highest rating of 5 power circles (among the best).
Number of categories/factors rated at about average or lower: 3
10. State Farm auto insurance — 868 points. State Farm has the same point score as The Hartford. But State Farm rated 4 power circles, or better than most, in all categories except the Appraisal Process and the Rental Car Experience, where it rated 3 power circles (about average), giving it an edge over The Hartford in this study, in my opinion.
Number of categories/factors rated at about average or lower: 2
*11. Allstate auto insurance — 863 points. 5 points below State Farm and The Hartford, Allstate is the lowest scoring company of the companies rated 4 power circles (better than most) for Overall Auto Claims Satisfaction & the category of Settlement. Allstate is still 11 points above the study average score, but considering the 1,000 point scale, this is not a measure of much greater satisfaction above the average. Allstate rated better than most for Service Interaction & Settlement, among the best for the Appraisal Process, but about average for First Notice of Loss, the Repair Process, and the Rental Car Experience.
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Number of categories/factors rated at about average or lower: 3
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The next 12 companies rated about average for Overall Auto Claim Satisfaction, and the most important category of Settlement. Companies 12 through 23 scored with a range from 5 points above the study average score, to a low of 14 points (on the 1,000 point scale) below the study average score. If you are insured with any of these companies for your car insurance, you should check to see if you qualify for any of the companies ranked 1 through 11. You may decide to change companies, not only to feel more confident you will receive good service if you have a claim, but because you may also be able to save a lot of money with the same coverage.
If you are looking for the best price for auto insurance with a company rating average or better for auto claims satisfaction, you want to get quotes from all the companies ranked 1 through 23 on this list for which you qualify.
Very occasionally, a company in this next group will rate 4 power circles (better than most) for a particular category, like Rental Car Experience. I would not allow any of these infrequent bright spots to influence your opinion the claims service is any better than average, though I will point them out.
I will also note the number of categories rating below 3 power circles (about average), at 2 power circles. The companies, in this next group of 12, having the lowest number of categories below average, may be your best choice.
12. Travelers auto insurance — 857 points. The highest scoring of the companies rated about average for Overall Auto Claims Satisfaction, Travelers scored 5 points above the study average score. Travelers rated better than most for the category of the Appraisal process, and about average for the other five categories.
Number of categories receiving the lowest rating of 2 power circles: zero (0).
13. AAA of Northern CA, Nevada, & Utah auto insurance — 852 points. AAA NCNU, formerly the California State Automobile Association (CSAA), scored the same as the study average. AAA NCNU rated about average in all six categories.
Number of categories receiving the lowest rating of 2 power circles: zero (0).
The 2012 US Auto Claim Study average score for all auto insurance customers responding to the survey: 852 out of 1,000 points.
*14. Nationwide auto insurance — 848 points. Scoring 4 points less on the 1,000 point scale than AAA NCNU, & only 9 points less than Travelers, Nationwide rated about average in all six categories of the auto claims process.
Number of categories receiving the lowest rating of 2 power circles: zero (0).
*15. GMAC auto insurance — 847 points. One point below Nationwide, GMAC rated about average in all categories, except First Notice of Loss, which received the lowest rating of 2 power circles.
Number of categories receiving the lowest rating of 2 power circles: 1.
16. AAA/Auto Club auto insurance — 843 points. Scoring 9 points less on the 1,000 point scale than the study average, AAA rated about average (3 power circles) for all categories, except the two factors of Service Interaction and the Appraisal Process, which rated 2 power circles.
Number of categories receiving the lowest rating of 2 power circles: 2.
17. Hanover auto insurance — 843 points. The Hanover tied AAA with its numerical score in this study. Hanover rated better than most (4 power circles) for the Rental Car Experience, rated below average with 2 power circles (the rest) for First Notice of Loss, and about average (3 power circles) for the other 4 categories.
Number of categories receiving the lowest rating of 2 power circles: 1.
18. Liberty Mutual auto insurance — 843 points. Liberty Mutual scored a three-way-tie with AAA & The Hanover. However, Liberty Mutual rated about average in all six categories.
Number of categories receiving the lowest rating of 2 power circles: zero (0).
*19. GEICO auto insurance — 842 points. Scoring only one less point than Liberty Mutual, AAA, & The Hanover, GEICO is inconsistent in the ratings of the six factors of the claims process considered. Geico rated better than most for the Rental Car Experience, below average with the lowest rating for Service Interaction and the Repair Process, and about average for First Notice of Loss, the Appraisal Process, and Settlement.
Number of categories receiving the lowest rating of 2 power circles: 2.
*20. Progressive auto insurance — 842 points. Tied with GEICO for the numerical score, Progressive rated about average in all categories, except the Repair Process, which received the lowest rating of 2 power circles.
Number of categories receiving the lowest rating of 2 power circles: 1.
21. Metlife auto insurance — 841 points. Scoring one point less on the 1,000 point scale than Progressive & GEICO, Metlife rated about average for four of the six categories, and received the lowest rating of 2 power circles for Service Interaction and the Rental Car Experience.
Number of categories receiving the lowest rating of 2 power circles: 2.
*22. Safeco auto insurance — 840 points. Scoring one point less than Metlife, Safeco rated about average in all six categories.
Number of categories receiving the lowest rating of 2 power circles: zero (0).
*23. Farmers auto insurance — 838 points. Scoring two points less on the 1,000 point scale than Safeco, Farmers rated about average in all six categories.
Number of categories receiving the lowest rating of 2 power circles: zero (0).
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The remaining five companies received the lowest rating of 2 power circles (the rest) for Overall Auto Claims Satisfaction and the factor of Settlement. Although these companies scored below average, their scores are not so much below the average to assume their claims service is terrible. Converted to a percentage score based on the 1,000 possible points, The top scoring company, NJM, received 89.6%, the study average is 85.2%, and the lowest scoring company, Commerce Insurance, is 78.1%. If the study was graded as a school test, Commerce would have earned a “C+,” not an “F.” However, if you have car insurance with any of the companies below, you should get price quotes with companies scoring higher on this list. You may be able to save money, as well as choose another company with higher auto claims customer satisfaction.
If you care only about getting the lowest price, or if you have problems qualifying for auto insurance due to your driving record or other issues, get quotes from the companies below, to see if you qualify and save money.
24. Mercury auto insurance — 824 points. Mercury is available in the following states: Arizona, California, Florida, Georgia, Illinois, Michigan, Nevada, New Jersey, New York, Oklahoma, Pennsylvania, Texas, & Virginia.
Number of categories receiving the lowest rating of 2 power circles: 3 out of 6.
*25. 21st Century auto insurance — 821 points. 21st Century did rate better than most for the Rental Car Experience, and about average for the Appraisal Process and the Repair Process, but below average for the remaining three categories.
Number of categories receiving the lowest rating of 2 power circles: 3 out of 6.
26. Encompass auto insurance — 820 points.
Number of categories receiving the lowest rating of 2 power circles: 3 out of 6.
*27. Esurance auto insurance — 801 points.
Number of categories receiving the lowest rating of 2 power circles: 6 out of 6.
28. Commerce insurance — 781 points. Commerce is available only in New Hampshire & Massachusetts. Commerce rated better than most in the category of Rental Car Experience.
Number of categories receiving the lowest rating of 2 power circles: 5 out of 6.
Now you know how the 28 largest car insurance companies in the US are rated for auto claims satisfaction in 2012, start shopping now to save money and improve your service. You really can accomplish both these goals if you get price quotes from all the leading companies.
You can click here to see the JD Power 2012 US Auto Insurance Claim Study. Do you have any questions about these claims satisfaction ratings? Leave a comment on my facebook page. Follow me on Twitter for important insurance consumer news and new blog entries at CarInsWatch.