IFA Insurance Review: Auto Insurance Customer Complaint Statistics & Downgraded AM Best Financial Strength Rating

IFA Insurance Company, an auto insurance company insuring cars in New Jersey, Pennsylvania, & Maryland, has had its AM Best Financial Strength Rating(FSR) downgraded again in 2014. If you have IFA auto insurance, you should consider shopping for a more financially stable company with a better complaint record. This blog post will review the latest financial strength ratings & future ratings outlook for IFA, and show you some of the top auto insurance companies in NJ, PA,& MD, to help you shop for a more financially secure insurer. Car insurance rates vary a lot among companies, with some companies charging twice as much as others. Contrary to what you might expect, some of the companies with the best ratings & complaint records may have competitive rates for you. You don’t have to pay more for better service. You can likely find a better auto insurance company and save a lot of money, compared to what you pay now with IFA for the same coverage. Read this IFA auto insurance review and use the ad below this paragraph to get car insurance quotes from some of the top insurance companies in New Jersey.


IFA Auto Insurance Review

IFA Insurance Company had its AM Best Financial Strength Rating(FSR) downgraded from “B+” (good) to B- (fair) as of 6/18/2013, with a negative outlook, meaning there could be another downgrade in the future. Most insurance agents will tell you not to insure with any auto insurance company, with less than an AM Best grade of “A-,” for the financial strength of the company. A grade of “B-” may still be above average when you are in high school, but it’s not a good grade for an insurance company. While updating this review from its original publish date of 6/23/2013, AM Best’s 2013 negative future outlook for IFA came to fruition. On March 17th, 2014, AM Best once again downgraded its Financial Strength Rating for IFA Insurance Company from “B-” (fair) to “C++” (Marginal), still with a negative outlook, meaning there could be another downgrade in the future.

Source: AM Best website

Why is the Financial Strength Rating for IFA being downgraded year after year by AM Best? Back in 2013, the Insurance Journal reported, in this article about the IFA Insurance Company AM Best rating downgrade, as explained by AM Best, the lower rating & negative outlook are due to the company’s deteriorating capital position, because of losses from Superstorm Sandy, and high claims costs in New Jersey. IFA Insurance Company is reacting by increasing auto insurance rates and refining its customer selection criteria, which is not good news for NJ, PA & MD auto insurance customers. As this blog post will show you, the latest four year car insurance customer complaint statistics (2010,2011, 2012 & 2013) for IFA should be a concern for policyholders, too.

About IFA Insurance Company, and how to get a price quote for your auto insurance.

IFA started in 1972, by selling auto insurance in New Jersey. It has since expanded to Maryland & Pennsylvania. Unlike some auto insurance companies, IFA offers the option for a 12 month auto insurance policy, instead of only a 6 month policy, with customers opting for the 12 month policy paying lower rates. IFA sells auto insurance direct from the company, and through local independent insurance agents also representing other companies. If you want a price quote from IFA, I would recommend getting a quote direct from the company. But if you choose to buy a policy, I’d find a good local independent insurance agent representing IFA. With its lower AM Best financial strength rating, and its high customer complaint ratios, I think you can find better options for your auto insurance than IFA Insurance.

However, auto insurance is a major expense, so if it turns out IFA auto insurance has the best rate for you, you may decide it might be a good choice for you. The only way to find out about rates, is to contact IFA for an auto insurance price quote, to see what they can do for you. Likewise, if your cars are insured with IFA, you should check with other car insurance companies, to see if they have a better deal for you. Go to the IFA website at ifaauto.com, if you wish to find out more about the company, or get a price quote for your car insurance.

IFA Insurance Company Customer Complaint Statistics & Ratings.

The complaint ratios I show below display the ratio of the company’s U.S. Market Share of closed complaints compared to the company’s U.S. Market Share of premiums for a specific policy type. Complaint ratios lower than “1” have less complaints than average, and complaint ratios over “1” have more complaints than average. The lower the complaint ratio, the less complaints against the company. The higher the complaint ratio, the more complaints against the company. The complaint ratios were obtained from the NAIC Consumer Information Source.

The complaint ratios are number scores, & may not be easy for everyone to interpret. I devised a grading system, giving grades to insurance companies based on the complaint ratios, to make it as easy as possible to find the best auto & home insurance companies & avoid the worst insurance companies.

B = Better than average. Insurance companies with complaint ratios less than 75% of the average insurance company.

C = Average. Insurance companies with complaint ratios from 75% to 125% of the average insurance company.

W = Worse than average. Insurance companies with complaint ratios more than 125% of the average insurance company.


IFA Insurance Company Auto Insurance Complaint Statistics & Ratings

2013 Auto Insurance Complaint Ratio = W (3.69)

2013 US auto insurance premium = $47,164,668

2012 Auto Insurance Complaint Ratio = W (1.40)

2012 US auto insurance premium = $44,835,587

2011 Auto Insurance Complaint Ratio = W (2.94)

2011 US auto insurance premium = $40,596,707

2010 Auto Insurance Complaint Ratio = W (3.15)


Alternatives to IFA auto insurance

Here are two of the largest & fastest growing auto insurance companies in NJ, MD, & PA:

Progressive auto insurance

GEICO auto insurance

This should come as no surprise to people, since it’s hard for anyone to avoid the massive amount of advertising by these two companies. Both of these companies sell most of their auto insurance by selling direct from the company. Companies selling direct are not always cheaper, as many people think, because they don’t pay an agent commission. But these two companies compete, more than some other companies, by trying to have competitive rates for all types of drivers. Some people prefer to have an agent, but if you bought your IFA auto insurance policy direct from the company, you may not mind buying direct from other auto insurance companies.

Here are two of the largest auto insurance companies in PA, NJ, & MD, selling auto insurance through their own local agents:

State Farm auto insurance

Allstate auto insurance

Don’t think it costs more to have a personal agent, because a commission is only one of many marketing expenses for an insurance company. Some expenses can be transferred to a company’s agents, making it a less expensive business model for an insurance company choosing to sell through agents. My experience selling and shopping for auto insurance has taught me almost every insurance company has great rates for some people, while having high rates for others, and it’s impossible to guess, based on what friends and family pay, or what an agent tells you, which company will have low auto insurance rates for you.

If you’re looking for a better auto insurance company, you’d be making a mistake not checking in with Allstate & State Farm. Also, these two companies sell their own home insurance, where Geico & Progressive partner with other companies to sell the partnering company’s home & renters insurance, possibly making State Farm & Allstate better choices for people also needing property insurance.


Auto insurance companies in NJ, PA, & MD with good complaint records and/or high JD Power customer satisfaction ratings

Here are some additional highly rated auto insurance companies you might want to consider:

Amica auto insurance

Erie auto insurance (Not available in NJ)

Plymouth Rock / High Point auto insurance (Not available in PA or MD)

You can find out these companies AM Best financial strength ratings, JD Power customer & claims satisfaction ratings, and customer complaint ratings on the home page of this website. Many people pay too much for their insurance because they never shop for better rates, or if they do shop, they don’t check the rates of enough companies. For a lot of people, the best insurance company is the one with good coverage, service, and the lowest rates. The ad below will take you to links to get online quotes from leading Home, Auto, Health, & Life insurance companies in your area. Choose the type of insurance, put in your zip code, & start shopping now!

What’s your experience with IFA Insurance Company? Tell me about it. Comment on my facebook page. If you have questions and would like my help, you can reach me at help@smartshopyourcarinsurance.com. Follow me on Twitter for important insurance consumer news & new blog entries at CarInsWatch.