Direct General Insurance Review: Auto Insurance Customer Complaints, JD Power Customer Satisfaction & AM Best Financial Strength Ratings

Direct General is an insurance company selling nonstandard auto insurance (for people not qualifying for lower-priced, standard or preferred auto insurance rates), motorcycle, and term life insurance in the 13 US states of Alabama, Arkansas, Florida, Georgia, Illinois, Louisiana, Mississippi, Missouri, North Carolina, South Carolina, Tennessee, Texas, & Virginia. Direct General is an important insurance company to know, if you live in any of the states where it operates, and have trouble qualifying for low auto or motorcycle insurance rates due to your or a driver in your household’s driving record, lack of driving experience, no prior insurance, lapse in coverage, or other reasons. When you pay a lot for auto insurance, and fewer car insurance companies will insure you, it’s even more important to know all your company options, and choose the company with acceptable service for the coverage you need at the best price. Now you know if Direct General is an option for you, it’s easy enough to contact them for a price quote. This review will show you not only how to contact Direct General for a quote, but give you the latest company ratings and complaint information about the Direct General insurance companies, to help you decide if Direct General is a good choice for you. I’ll also give you the names of the major insurance companies offering nonstandard auto insurance, competing with Direct General, so you have more options to shop for a better price or better service.

Direct General Insurance Review

When evaluating a car or motorcycle insurance company, like Direct General, you can find many customer experiences on review & complaint Websites. But even if you find many negative reviews, they may not be enough to be truly representative of a company with tens of thousands of customers. All insurance companies, particularly nonstandard auto insurance companies like Direct General, have unhappy customers writing complaints about their service. In my experience, most customers satisfied with their auto insurance company are silent about it. If you do find them, no large amount of positive reviews can guarantee you will not have a negative experience, and trusting negative reviews based on personal experiences will have you thinking all insurance companies are terrible. However, when you look at complaint statistics over several years, and customer satisfaction surveys including the opinions of thousands of customers, you have more reliable information to see negative or positive trends regarding an insurance company’s customer service.

I think this review of Direct General, looking at the company’s JD Power ratings and complaint statistics, is more objective than your typical reviews, and more likely to reflect the actual experience of the majority of customers. I’ll review the most recent JD Power auto insurance customer satisfaction ratings for Direct General, and analyze the company’s complaint statistics for the past three years, to let you know if Direct General has a worse than average, average, or better than average complaint record.

The first thing you want to evaluate is if your auto insurance company is financially strong, with an adequate amount of money in reserves to pay claims. An insurance company with inadequate reserves is more likely to delay claims payments, or not meet its obligations if there are a large number of claims. AM Best is the most frequently cited insurance company rating agency. AM Best’s highest rating is “A++.” I would not insure with any home or auto insurance company with less than an “A-” rating from AM Best, if possible. But keep in mind, insurance company rating agencies evaluate a company’s financial strength, not its customer or claims service. A nonstandard auto insurance company with large reserves may be rated “A,” but that does not mean it earns an “A” for its claims service.

Direct General Insurance Company’s AM Best Financial Strength Rating

All five Direct General subsidiaries selling auto or motorcycle insurance were most recently had their AM Best Financial Strength Ratings of “B” (Fair) affirmed on 02/10/2016, with a stable outlook, meaning no rating upgrade or downgrade is expected in the near future. It’s not unusual for many nonstandard auto insurance companies to have less than an “A-” AM Best financial strength rating, but that’s no reason to settle for an insurance company with a weaker financial strength rating, even if some of the higher rated auto insurance companies are unwilling to insure you. As I mentioned above, I prefer to choose an auto insurance company with no less than an “A-” AM Best rating, whenever possible. Of course, price and coverage are important factors, too. GEICO & Progressive are able to insure most drivers, and both of these companies have higher AM Best ratings than Direct General.

Direct General Insurance Company Customer Complaint Statistics & Ratings

The complaint statistics below display the ratio of the company’s U.S. auto (including motorcycles) insurance market share of closed complaints compared to the company’s U.S. market share of premiums for auto and motorcycle insurance. 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 compared to its competitors, adjusted for market share. The higher the complaint ratio, the more complaints against the company. The complaint ratios I use were obtained from the NAIC Consumer Information Source. You can read more about the sources of my information by visiting my Website’s home page, and clicking the link at the bottom of the page.

The complaint ratios are number scores, and may not be simple to interpret at a glance. I devised a rating system, giving grades to the Direct General subsidiary companies based on their complaint ratios, to make it easier to compare with the other companies reviewed on my site, to assist you in finding the best car insurance companies, and avoid the worst car 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.

Here are the complaint ratings for the five Direct General insurance company subsidiaries sell auto or motorcycle insurance:


Direct General Insurance Company Auto Insurance Complaint Statistics & Ratings

B = Better than average C = Average W = Worse than average

2014 Auto Insurance Complaint Ratio = W (5.78)

2014 US auto insurance premium = $310,073,587

2013 Auto Insurance Complaint Ratio = W (2.88)

2013 US auto insurance premium = $294,496,730

2012 Auto Insurance Complaint Ratio = W (4.69)

2012 US auto insurance premium = $258,958,630

2011 Auto Insurance Complaint Ratio = W (3.93)

2011 US auto insurance premium = $222,863,586

2010 Auto Insurance Complaint Ratio = W (4.58)

Many nonstandard auto insurance companies have higher than average complaint records. Most auto insurance complaints made to a state’s department of insurance are regarding claims, and nonstandard auto insurance customers, as a statistical group, have more claims, allowing for the possibility of more service problems. Also, some nonstandard auto insurance companies have a small market share, resulting in a small number of complaints creating a high complaint ratio.

For example, a small company with no complaints has a 0.00 complaint ratio. But the following year it has 1 complaint, and because it has few customers compared to some other companies, its complaint ratio jumps from 0 to 2.00, which is two times the industry average complaint ratio. The next year it has the same market share, but 3 complaints, so its complaint ratio jumps to 6.00, or six times the industry average. A larger company, may have 300 complaints, but a lower complaint ratio of 3.00, because it has many more customers than the smaller company. You might be tempted to think the larger company is a better choice than the smaller company, because it has a lower complaint ratio. That would be an improper conclusion, because a larger company with a complaint ratio three times the average, is definitely performing worse than average, where a small company with a very high complaint ratio based only a few complaints is not enough complaints to establish an expectation of below average service.

However, the Direct General Insurance Company complaint ratios listed above are not influenced by small market share and only a few complaints. This company is the largest Direct General subsidiary of the five subsidiaries, selling auto insurance in Alabama, Florida, Georgia, Missouri, South Carolina, Texas, & Virginia, and based on the distribution of complaints, probably has most of its customers in Florida. Direct General had 215 closed complaints in 2015 (complaint ratios not available yet), 185 closed complaints in 2014, 68 closed complaints in 2013, 117 closed complaints in 2012, 102 closed complaints in 2011, and 115 closed complaints in 2010, and 4 closed complaints reported so far for 2016. Market share for this largest Direct General subsidiary has increased from $212,267,485 in annual auto insurance premium for 2011, to $258,958,630 for 2012, to $294,496,730 for 2013, to $310,073,587 for 2014 which is an increase of more than 10% each year from 2011 to 2013. A large increase in annual premium usually means more new customers, which may be a sign the company has competitive rates for motorcycle or nonstandard auto insurance. However, this subsidiary’s consistently poor complaint record should be a concern for anyone insuring or planning to insure with Direct General Insurance Company.


Direct General Insurance Company of Mississippi Auto Insurance Complaint Statistics & Ratings

B = Better than average C = Average W = Worse than average

2014 Auto Insurance Complaint Ratio = W (6.26)

2014 US auto insurance premium = $24,755,133

2013 Auto Insurance Complaint Ratio = W (8.58)

2013 US auto insurance premium = $23,301,343

2012 Auto Insurance Complaint Ratio = B (.48)

2012 US auto insurance premium = $21,848,070

2011 Auto Insurance Complaint Ratio = W (3.17)

2011 US auto insurance premium = $21,624,867

2010 Auto Insurance Complaint Ratio = W (4.43)

2010 US auto insurance premium = $32,468,639

Direct General Insurance Company of Mississippi sells auto and motorcycle insurance in Mississippi & Kentucky. Since it operates in only two states, it’s size is less than 1/10th of the Direct General Insurance Company reviewed above, at $24,755,133 in annual written auto insurance premium for 2014. This is substantially down from $32,468,639 in annual written auto insurance premium for 2010, which could be due to less competitive rates, though the auto insurance market share for Direct General Insurance Company of Mississippi has grown slightly each year since its drop off in 2011.

As explained above, sometimes a small number of complaints for a small auto insurance subsidiary can have a big influence on the size of the complaint ratio. For example, one complaint in 2012 resulted in a .48 complaint ratio, which is better than average. But another complaint in that year would have made the complaint ratio close to average. One more additional complaint (3 complaints total) would have made the ratio higher than average.

Direct General Insurance Company of MS had 23 auto insurance complaints in 2015 (complaint ratios not available yet), 16 auto insurance complaints in 2014, 16 auto insurance complaints in 2013, 8 complaints in 2011, and 17 complaints in 2010. Even for its small size, these amounts of complaints per year are a concern. If you live in KY or MS, and need nonstandard auto insurance, you may want to buy from Direct General only if they have the best price, because the company’s complaint record does not show a trend of average or better than average level of complaints for the last three years.


Direct General Insurance Company of Louisiana Auto Insurance Complaint Statistics & Ratings

B = Better than average C = Average W = Worse than average

2014 Auto Insurance Complaint Ratio = W (4.54)

2014 US auto insurance premium = $21,330,365

2013 Auto Insurance Complaint Ratio = W (4.17)

2013 US auto insurance premium = $20,994,068

2012 Auto Insurance Complaint Ratio = W (3.94)

2012 US auto insurance premium = $23,715,453

2011 Auto Insurance Complaint Ratio = W (1.74)

2011 US auto insurance premium = $24,605,954

2010 Auto Insurance Complaint Ratio = W (4.50)

2010 US auto insurance premium = $28,225,397

Like Direct General Insurance Company of Mississippi, Direct General Insurance Company of Louisiana is a small subsidiary of about the same size, operating only in Louisiana, with $21,330,365 in annual written premium for all its auto & cycle insurance policies in 2014. This is down from $28,225,397 in 2010, and could be a sign of shrinking market share due to high auto or cycle insurance rates. Direct General Insurance Company of Louisiana had 6 complaints in 2015, 10 complaints in 2014, 7 complaints in 2013, 9 complaints in 2012, 5 complaints in 2011, and 15 complaints in 2010. Keep in mind, these are complaints filed by consumers with the Louisiana state department of insurance, not everyone complaining about the company’s service online, to their agent, or the company itself. Even with small subsidiaries, a consistent history of worse than average complaint ratios is not a good sign. If you can find an auto or cycle insurance company with better or comparable rates and a better complaint record, it may be a wiser choice for you.


Direct Insurance Company Auto Insurance Complaint Statistics & Ratings

B = Better than average C = Average W = Worse than average

2014 Auto Insurance Complaint Ratio = W (1.68)

2014 US auto insurance premium = $57,551,059

2013 Auto Insurance Complaint Ratio = W (3.88)

2013 US auto insurance premium = $54,709,802

2012 Auto Insurance Complaint Ratio = W (2.84)

2012 US auto insurance premium = $51,129,412

2011 Auto Insurance Complaint Ratio = W (4.19)

2011 US auto insurance premium = $49,149,826

2010 Auto Insurance Complaint Ratio = W (3.23)

Direct Insurance Company is about 1/5th the size of the largest Direct General subsidiary, but its twice the size of Direct General Insurance Company of MS or Direct General Insurance Company of LA, at $57,551,059 in written auto & motorcycle premium for 2014. Market share for this subsidiary has grown slightly each year since 2011. Direct Insurance company operates only in Arkansas & Tennessee. As with Direct General Insurance Company of Louisiana, the complaint ratios over the last three years show a consistent trend of worse-than-average level of complaints.


Direct National Insurance Company Auto Insurance Complaint Statistics & Ratings

B = Better than average C = Average W = Worse than average

2014 Auto Insurance Complaint Ratio = W (5.26)

2014 US auto insurance premium = $11,047,234

2013 Auto Insurance Complaint Ratio = W (8.69)

2013 US auto insurance premium = $11,506,614

2012 Auto Insurance Complaint Ratio = W (13.61)

2012 US auto insurance premium = $12,972,195

2011 Auto Insurance Complaint Ratio = W (7.45)

2011 US auto insurance premium = $12,671,995

2010 Auto Insurance Complaint Ratio = W (4.44)

2010 US auto insurance premium = $17,143,720

The Direct National Insurance Company is the smallest Direct General subsidiary, with only $11,047,234 in annual written premium for its auto & cycle insurance policies in 2014. This is almost half the size of the next smallest subsidiary. The auto insurance market share for Direct National Insurance Company decreased each year since 2012, and had a large drop in 2011 from $17,143,720 in annual written premium in 2010. Direct National Insurance Company operates in the states of Arkansas, Illinois, Kansas, Missouri, & Texas. but there are other Direct General subsidiaries operating in most of these states. Direct National Insurance Company had 4 complaints in 2015, 6 complaints in 2014, 8 complaints in 2013, 17 complaints in 2012, 11 complaints in 2011, and 9 complaints in 2010. Although each year’s amount of auto insurance complaints are not always many in number, and result in very high complaint ratios due to this subsidiary’s small size, the company still has a consistently worse than average complaint record I believe to be reliable. Direct National had 4 complaints in its best year, which is enough complaints to say the complaint ratio is not unduly influenced by one or two complaints.

Direct General Insurance Company’s JD Power Auto Insurance Customer Satisfaction Study Ratings

Direct General Insurance Company was included in the JD Power auto insurance customer satisfaction study for the Southeast region in 2012, but was not included in the 2013, 2014, or 2015 studies, most likely because of too few Direct General customers in the region, resulting in not enough responses to the JD Power survey. Starting in 2013, Florida, a state previously included in the SE Region, has its own regional study, greatly reducing the number of Direct General insurance customers in the SE region, with Direct General not having enough auto insurance business in Florida alone to make the Florida region study.

The 2012 Southeast region included Direct General auto insurance customers in the states of Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina, & Tennessee. In 2012, Direct General scored 744 on the 1,000 point scale, earning the lowest JD Power rating of 2 power circles, and it was the lowest scoring auto insurance company in the Southeast region. However, on a percentage basis, Direct General scored 74.4%. If the lowest grade received by the worst student in the class is a “C,” that isn’t a failing grade for the worst student.

Contacting Direct General Insurance Company

Direct General sells its auto & cycle insurance through 240 sales offices located throughout the 13 states it offers coverage. You can locate an office near you, through the Direct General website. You can also request a motorcycle or auto insurance price quote through the company site, or by calling the company. Here’s the link to the Direct General Insurance Company Website to find out more.

Direct General Compared to Competing Auto Insurance Companies

When it comes to customer satisfaction or complaint record, there are many companies doing a better job than Direct General. However, drivers considered high risk by auto insurance companies do not always have a lot of options. Here are some alternative companies more likely to be willing to help you. Auto insurance is expensive, and even for drivers with tickets and accidents or other issues leading to higher rates, some companies charge a lot more than others for the same coverage. It pays to shop, so get price quotes from as many companies willing to offer you coverage. The ads on this page link to many of these companies:

Progressive

GEICO

21st Century

Infinity

Unitrin Direct

The General

You can read reviews and see complaint ratings for these companies at the home page of my website.

Lower priced car & motorcycle insurance companies with better rates than Direct General

The only way to find the best insurance coverage & low rates for you is to shop with all the leading insurance companies. 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, acceptable 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 do you think about this Direct General Auto Insurance review? 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.