JD Power has recently released its 2013 US Auto Insurance Customer Satisfaction Study. Although these annual JD Power customer surveys are great resources for consumers to use, as an objective measure of customer satisfaction, for each of the major car insurance companies in the USA, the power circle ratings, used by JD Power to rate each insurance company, can mislead people about how well or how poorly each company performed in the survey.
Someone should expect a 5 power circle rated (among the best) auto insurance company to provide superior customer service. But in this latest JD Power study, most of the 5 power circle rated companies did not score much above the companies rated 4 power circles. Some of the 4 power circle rated (better than most) insurance companies did not score much above the 3 power circle rated (about average) companies. One might also expect, an auto insurance company with the lowest power circle rating (2 power circles), to provide consistently terrible service. But the scores of many of the two power circle rated companies are not much below the study average score.
Price is a factor considered in this JD Power customer satisfaction survey, but the study results can not be used to dependably show the companies having the best price for you. This study’s scores are lower than last year’s results, and explained by JD Power as being due to customer dissatisfaction with rate increases. There are big differences in the rates of competing auto insurance companies (Some companies charge double the amount of others for the same coverage), and there is no connection with paying more or less based on the quality of customer service.
When some companies increase the price of their auto insurance, it’s even more important to find a company with the best price for you. A smart auto insurance shopper checks the rates of all the major companies, then evaluates the customer service of the companies offering the coverage they need, at the lowest rates. Like my previous blog posts analyzing JD Power studies, this blog post will look at the numerical scores, and show you the best car insurance companies, truly distinguishing themselves above their competitors, and the worst companies truly performing below average.
JD Power has improved on the changes to its annual US auto insurance customer satisfaction study it made last year, by segmenting it into a larger collection of regional studies. Ideally, 50 studies to cover each state would be the most useful, since each state’s auto insurance market is unique. For example, New York Central Mutual is an important auto insurance company in New York, but it was never large enough to be included in the previous JD Power annual customer satisfaction studies, when it was a single national survey.
Some largely populated states, like New York, Texas, Florida and California, do have their own studies. But other states are grouped into regions, which still allows auto insurance companies big in a single state, like Plymouth Rock Assurance in NJ, or a regional car insurance company, like PEMCO (Oregon, Washington) to be included in the study. Another regional auto insurer, Erie insurance, used to make the old national study, but knowing its level of customer satisfaction is not helpful to readers of the national study, unless you live in the eleven or so states where Erie is available. By using the new regional study model, the survey results covering the state where you live is much more relevant to you.
Rather than showing you the misleading power circle rating for the companies in each region, I’ll look at the numerical score for each auto insurance company, and put them into a category of best, better than average, average, below average, and worst.
First off, one company has the highest score by far in every region, above all the other auto insurance companies. Unfortunately, the company has restricted eligibility to the US military, their spouses & children, and honorably discharged veterans. But if you qualify you should definitely consider this company.
Highest Scoring Auto Insurance Company for All 2013 Regional Studies
Best: USAA (United Services Auto Association)
The next highest scoring company, Texas Farm Bureau, scored 862 points out of 1,000 possible points. USAA, in the same Texas region study, scored 908 out of 1,000 points. The regional average score was 797 points out of 1,000. Converted to a percentage, Texas Farm Bureau scored 86%, USAA scored 91%, and the average for all companies is 80%.
5 percentage points may not seem like a huge difference, but it is significant, when you consider Texas Farm Bureau & USAA are both rated 5 power circles. There is a 6 percentage point difference between Texas Farm Bureau, and a company scoring close to the average, like Progressive, scoring 804 out of 1,000 points. But Progressive is rated 2 grades lower, at 3 power circles.
USAA scores much higher than the other 5 power circle rated auto insurance companies, and it is the clear winner of the study. USAA scored from 881 to 912, depending on the region. Also, USAA has maintained high scores like these scores year after year for this annual study.
California Region
Regional average: 777 out of 1,000 points.
Best: None.
Better than average: Wawanesa (820), State Farm (812), Hartford (811), Auto Club of Southern California (802), GEICO (801), Ameriprise (798).
Average: Safeco (789), Progressive (785), AAA Northern CA, Nevada & Utah (782), Allstate (782), Liberty Mutual (780), Mercury (774).
Below average: Nationwide (761), 21st Century (752), Travelers (745), Kemper-Unitrin (742), Farmers (737).
Worst: Infinity P&C (684).
Central Region (Arkansas, Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, Oklahoma, South Dakota)
Regional average: 801 out of 1,000 points.
Best: None.
Better than average: State Farm (833), Auto Owners (821), Shelter (817).
Average: American Family (812), Hartford (809), Farm Bureau Mutual (806), GEICO (806), AAA Missouri (795).
Below average: Allstate (787), Safeco (787), Travelers (787), Farmers (785), Progressive (783), Liberty Mutual (782), Nationwide (780).
Worst: None.
Florida Region
Regional average: 790 out of 1,000 points.
Best: None.
Better than average: None.
Average: Metlife (808), Hartford (802), State Farm (800), Auto Owners (796), Allstate (790), Progressive (790), GEICO (788).
Below average: Safeco (782), Nationwide (778), Liberty Mutual (782), 21st Century (773), Travelers (773).
Even more below average: Esurance (760).
Worst: Infinity Property & Casualty (735).
Mid-Atlantic Region (Delaware, District of Columbia, Maryland, New Jersey, Pennsylvania, Virginia, West Virginia)
Regional average: 802 out of 1,000 points.
Best: New Jersey Manufacturers (865) (NJM Insurance is open only to New Jersey Business & Industry Association members, State of New Jersey employees, NJM’s previously insured drivers, and/or previous/current auto/homeowner policyholders).
Better than average: State Farm (836), Erie (826).
Average: GEICO (811), Hartford (811), Allstate (799), Nationwide (797), Progressive (796), Travelers (795).
Below average: Liberty Mutual (769).
Even more below average: Plymouth Rock Assurance (757) (Formerly High Point & Palisades auto insurance companies).
Worst: 21st Century (747).
New England Region (Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, Vermont)
Regional average: 769 out of 1,000 points (This regional average is very low compared to other regions, so I will consider the auto insurance companies rated in the New England region, in relation to the entire study average for all regions, which is 794 out of 1,000 points).
Best: Amica (850)
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Better than average: None.
Average: GEICO (794), State Farm (794), Hartford (793), Nationwide (787).
Below average: Liberty Mutual (782), Allstate (781), Progressive (775).
Worst: Arbella (755) Plymouth Rock Assurance (752), Hanover (749), Commerce – MAPFRE (748), Metlife (744), Travelers (744), Safety (740)
New York Region
Regional average: 776 out of 1,000 points.
Best: None.
Better than average: New York Central Mutual (814) State Farm (807).
Average: Travelers (783), Liberty Mutual (779), Hartford (778), Allstate (772), GEICO (770).
Below average / Worst: Metlife (759), Progressive (754), Nationwide (751).
North Central Region (Illinois, Indiana, Michigan, Ohio, Wisconsin)
Regional average: 797 out of 1,000 points.
Best: None.
Better than average: Auto Owners (833) State Farm (824), Erie (823).
Average: Michigan Farm Bureau (809), Hartford (803), Nationwide (796), GEICO (794), Grange (794), American Family (790), Allstate (788), Country (785), Liberty Mutual (784), Farmers (783), Progressive (782).
Below average: Auto Club Group (AAA) (775), Hanover (764).
Worst: None
Northwest Region (Idaho, Montana, Oregon, Washington, Wyoming)
Regional average: 792 out of 1,000 points.
Best: None.
Better than average: PEMCO (834), Hartford (820), Mutual of Enumclaw (813).
Average: State Farm (805), American Family (795), Progressive (787), Liberty Mutual (785), Allstate (783), GEICO (780), Nationwide (780).
Below average / Worst: Safeco (771), Farmers (769).
Southeast Region (Alabama, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee)
Regional average: 804 out of 1,000 points.
Best: Tennessee Farm Bureau (850).
Better than average: State Farm (822), North Carolina Farm Bureau (821), Auto Owners (819).
Average: Alfa (811), Liberty Mutual (810), Nationwide (799), Safeco (795).
Below average: Progressive (791), Travelers (791), GEICO (791), GMAC (791), Allstate (790), Kentucky Farm Bureau (786).
Worst: None.
Southwest Region (Arizona, Colorado, Nevada, New Mexico, Utah)
Regional average: 805 out of 1,000 points.
Best: None.
Better than average: State Farm (824), Hartford (821).
Average: GEICO (809), American Family (807), Liberty Mutual (793), Allstate (789), AAA of Northern CA, Nevada,& Utah (788).
Below average: Progressive (778), Farmers (773).
Worst: None.
Texas Region
Regional average: 797 out of 1,000 points.
Best: Texas Farm Bureau (862).
Better than average: GEICO (815) State Farm (810).
Average: Allstate (807), Liberty Mutual (806), Progressive (804), Nationwide (796).
Below average / Worst: Farmers (768).
This study measured customer satisfaction across five factors: interaction, price, policy offerings, billing and payment and claims. Of the five factors, the factor of price scored the lowest (100 points less than claims or interaction), and had the most customer dissatisfaction.
Do you agree with my assessment of the best & worst auto insurance companies in the USA? 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.