Auto Insurance Rating Methodology

Our Rating System for Auto Insurers

To create our car insurance company rating methodology, we considered coverage, optional protections and average cost data from Quadrant Information Services. We also weighed ratings from the Better Business Bureau (BBB) and credit rating agency AM Best. In addition to gathering hundreds of data points, we conducted a survey of 1,000 consumers with auto insurance to understand what mattered most to them when shopping for coverage.

These are the five categories we used to create our auto insurance company ratings:

• Coverage
• Cost and Discounts
• Industry Standing
• Customer Experience 
• Availability

---

Factors We Use To Score Auto Insurance Companies

We begin our scoring process by giving each provider a rating out of 100, then later translate that into a score on a 10-point scale. This overall score is based on the average of a company’s rating in five main categories. The sections below offer expanded details on each of these categories. Note that some percentages are rounded for clarity.

Coverage (30%)

Beyond the standard auto insurance coverage options, we look for extra add-on protections an insurer offers, like roadside assistance, rental car reimbursement and more. These are a few of the specific things we consider for this category:

• Usage-based insurance programs: Most of our top-ranked insurers give drivers the opportunity to save money by tracking safe driving habits.
• Benefits: Roadside assistance, rental car reimbursement, trip interruption coverage and accident forgiveness are among the extra benefits we look for when evaluating auto insurers. The more the benefits, the higher the rating.
• Extra coverages: Offering additional coverages like pet insurance, windshield protection, and custom parts and equipment insurance help companies improve their coverage rating.
• Coverage ratings from consumers: We consider the results of our car insurance survey, which asked nearly 7,000 drivers how they would rate their providers’ coverage options. Providers with a rating of 4.0 to 5.0 — higher than the average across all providers — earn the most points.

Cost and Discounts (25%)

Coverage rates play a significant role in any driver’s choice of auto insurance. We use cost data from Quadrant Information Services to compare rates for various driver profiles. We also consider how many discounts a provider offers. Finally, the results of our car insurance survey play a part here.

Here’s a look at the key variables we weigh when we rate insurers in this category:

• Rates compared to the national average: Companies that can beat the average national cost of full-coverage auto insurance have a leg up here.
• Rate change: We also keep a close eye on how rates change year after year.
• Quotes for various driver profiles: We use cost data to help drivers with various violations on their record and drivers of all ages to get a complete picture of each provider’s rates.
• Total number of discounts: Multi-vehicle, bundling and good student discounts are pretty common, but providers that go beyond traditional savings opportunities such as with accident forgiveness or safe driving discounts get higher ratings in this category.

Industry Standing (20%)

This category encompasses a provider’s reputation in the auto insurance industry. These are a few of the important factors that contribute to its rating:

• Market share (8%): We use a provider’s market share, as determined by the National Association of Insurance Commissioners (NAIC), as a key indicator of industry standing. A provider earns maximum points if it has a market share of 15% or more and has written 40 billion premiums or more in the previous year.
• Years in business (4%): Auto insurers with long track records have an advantage, with those having been in business for 80 years or more earning maximum points.
• BBB rating (4%): The BBB rates companies for how quickly they respond to complaints and how well they communicate with customers. A high grade and accreditation from the BBB goes a long way in our rankings.
• AM Best rating (4%): Major credit rating agency AM Best gives insurers grades of up to A++ for financial strength. As you would expect, names like Travelers, State Farm and Geico carry A++ ratings.

Customer Experience (15%)

Along with BBB and Trustpilot ratings, we also consider the results of our survey when we rate companies for customer experience. We also look at J.D. Power studies, NAIC complaint data and customer ratings of a company’s mobile app and/or usage-based insurance app.

These are the major factors we analyze for this category:

• Online customer ratings: We comb through BBB and Trustpilot to see what customers are saying about auto insurance companies.
• NAIC complaint index: The NAIC divides a provider’s share of complaints in the U.S. auto insurance market by its share of premiums to arrive at this figure.
• J.D. Power studies: J.D. Power ranks auto insurers by overall customer satisfaction, how easy it is to buy a policy and the ease of the claims process.
• App ratings: How users on the App Store and the Google Play Store rate a provider’s mobile app factors into our ratings in this category.

Availability (10%)

The size of an insurer and the availability of its policies are the key considerations here. These are the specific criteria we use:

• Exclusions (10%): A few providers lose points in this category for having eligibility restrictions. (USAA, AAA and AARP are some examples.)
• State availability (5%): A few providers in our rankings only serve a handful of states. Being available across the country is an advantage in this category.
• Insurer size (5%): The larger the provider, the higher the availability score.

---

The Bottom Line: How To Choose the Right Auto Insurance Company

We rank auto insurance companies to help you find the best match for your budget and unique coverage needs. The information we gather on insurers in our roundup articles (that consist of multiple insurance providers) helps us rank them and add context to our reviews of individual companies.

To get the auto coverage you need at the best possible price, we recommend comparing quotes from multiple providers.

AM Best disclaimer