The Wise Insurance Shopper

The best information about US auto & home insurance companies on the Web!


  

My Auto & Home Insurance Shopping Guides Explained

Below are the frequently asked questions (FAQ) regarding my auto & home insurance shopping guides. Use this FAQ to help you better use my guides and make wiser decisions when choosing an insurance company. Feel free to email me at help@smartshopyourcarinsurance.com if you have questions about my guides not answered on this web page.

1. How do you determine which companies have a much better than average auto and home insurance complaint record?

Near the beginning of each US state guide, before I show you the major auto & home insurance companies in your state alphabetically, I show you some of the companies available in your state with a recent auto and home insurance complaint record much better than the industry average.

In my opinion, as someone who has worked in the auto & home insurance business for decades, the customer complaint data compiled by the National Association of Insurance Commissioners (NAIC) is the best resource to find insurance companies with a consistent record of better than average service. The NAIC gathers complaint data from all reporting US states and publishes it on their website, so you can compare insurance company complaint records. Some state department of insurance websites also publish insurance company complaint data for their state, but not all states publish their complaint data.

According to the NAIC website, the five top reasons for auto & home insurance complaints, filed by customers or third parties with state insurance departments, are all claims related (claim handling delays, denial of claims, unsatisfactory settlements, adjuster handling, failure to promptly pay a claim), so this is important information to consider when choosing an insurance company. You do not want to wait until you have a major claim to find out you are one of many customers having the same problems with your insurance company.

Here are some boring details on how I use the NAIC complaint statistics:

The NAIC publishes a complaint index for lines of insurance (for example, homeowner insurance) for each of the most recent three years. The complaint index for a line of insurance for all companies nationally (the industry average) is 1.00. Companies with a complaint index higher than 1.00 have a greater than average number of complaints and companies with a complaint index lower than 1.00 have fewer than average number of complaints, adjusted by the market share for each company.

If a company has a NAIC complaint index for auto and home insurance in all three years closer to half the average or lower, I consider the company to have a much better-than-average complaint record. Exceptions are made for small companies with only a few complaints. I consider the complaint indices for subsidiaries of the same brand to determine its three-year complaint record. Most insurance brands have several subsidiary companies providing auto and home insurance in a particular state or states. I considered the NAIC complaint indices for the larger subsidiaries only, as representative for the entire company. I sometimes average complaint statistics by size if there are multiple large subsidiaries.

The NAIC complaint statistics adjust for all three years over time as more data is reported. I will update my guides each September, when I am sure the prior year complaint data is reliable and is not likely be adjusted significantly in the future.


2. What is the importance of auto & home insurance company market share?

The NAIC publishes each year the ten largest auto insurance companies and ten largest home insurance companies for each state for the previous year. Until I update my guides again in September 2023, I use the NAIC market share information for 2021 for my guides. Some of the top ten companies are large insurance groups that own several insurance brands. For example, Liberty Mutual Group includes Liberty Mutual, Safeco, and for 2022, will include State Auto customers. I note this in my guides and separate the brands if they operate as separate businesses. I do not include top ten companies if they are a specialty insurer, such as a nonstandard auto insurance company insuring only high risk drivers or companies insuring only high value homes.

If you are going to shop, it is good to know the companies insuring the most cars and homes in your state, so you can check their coverage and rates to see if they might be the best company for you. However, the companies with the largest market share are not better because of their size or will necessarily have low rates for you. In my guides, you will see many of the companies with consistently much better than average auto and home insurance complaint records will not be among the ten largest auto or ten largest home insurance companies in your state. As for rates, I have been able to save a lot of money with small, lesser-known companies having very little market share in my state. Most companies in any state have 1% or less of the market, including companies in the bottom half of the top ten. For my guides, I tell you about the top ten companies, other large, national brands, and most of the companies with much better than average complaint records. I also try to include links to independent agents representing other auto and home insurance companies I do not mention and link to a supplemental guide of other companies, so you have the information you need to come as close as possible to shopping the entire market.

How to consider insurance company market share:

Do not choose an auto or home insurance company because of its market share. There is no short cut to finding the company with the best combination of coverage, service, and rates for you. Shopping thoroughly is the only solution to saving the most money and finding the best insurance company for you.


3. Links to insurance companies in my guides, how to buy a policy, and the best way to get a price quote:

At this time, my guides link to the website for each insurance company, if the insurance company has a website. Although many companies allow you to get a quote online or buy direct from the company, a lot of them do not offer a discount or lower rate for doing so. The best way to get a price quote is from an experienced, licensed insurance professional knowing how to compare your coverage, get you all the discounts you deserve, and quote you the best price possible for the coverage you need. For companies that do give you a discount for buying direct or online, I recommend getting a price quote from an agent first to see if you are really saving money with the online quote. If you can save money by buying direct or online, the discount may be only temporary or the price savings may not be worth it, considering how important it is to have an agent help you if you have a problem with the company. In my guides, I let you know if I am aware an insurance company offers a lower rate for buying direct or online in the section for each company where I explain how you can buy a policy.

Are you recommending the agents or agencies you link in your guides?

I do not vouch for any of the agents or agencies linked in my guides and have not screened them in any way. Moving forward, I want users of my shopping guides to have more detailed profiles of several insurance professionals for each company to help them find a good agent. This will take time for me to reach out to agents for this information. Before you buy insurance from any agent, you should check to make sure they are properly licensed and appointed to represent the company or companies they are quoting you before you buy a policy. You may be able to check to see if an agent is licensed at your state department of insurance website. I have links to each state department of insurance website on this webpage here.


4. Additional information I use in my guides:

In my first few paragraphs for each company, I inform you on some basic information about the company, including where it operates, what types of personal insurance it sells, the year it was founded, its subsidiary companies, its headquarters, other brands it owns, and other information I consider relevant. Most of this information I gather from company websites, but I also use the AM Best website, state insurance department websites, the previously mentioned NAIC website, and other sources on the web. Please let me know if you find any inaccurate information in my guides so I can investigate and correct it if needed.