How are car insurance companies ranked?

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Here's what you need to know...

  • There are several companies that rank and rate insurance companies and all that data should be considered when making your car insurance choice
  • Customer ratings deal with how a company treats their customers
  • Financial ratings concern the stability of the company and their ability to pay claims

Car insurance companies are ranked in a number of different ways from customer ratings to rankings by professional companies based on customer surveys and/or financial ratings.

When choosing an auto insurance company, you should consider all types of ratings before you decide.

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A financially secure company, for example, doesn’t necessarily have the best customer service.

Read on to learn some of the things that you should consider when looking at rankings for insurance companies.

Customer Rankings

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You can find customer rankings of auto insurance companies in a variety of different places.

  • Your first stop should be your state’s Department of Insurance. An insurance company’s rating in one state can be very different than their rating in another state. Focus on ratings for your state and then check neighboring states if the results are too close for you to make a decision based on this information.
  • JD Power and Associates is an excellent source for finding insurance company ratings. The information that JD Power provides is entirely based on consumer ratings and not on their own experiences with an insurance company.
  • In addition to these professional ranking sources, you can look for websites that focus on offering reviews and rankings, like Consumer Reports. It is important that you choose independent sites that are not funded or that do not represent any auto insurance companies.
  • You can also find forums and such that don’t necessarily rank insurance companies but simply discuss customers’ personal experiences as well as give those with questions a place to ask them without getting the “company line” that they would receive if they called an insurance company directly.

When you use the Department of Insurance to check a company’s rating, you are going to see a rating based on complaints. These complaints will usually be listed per 1,000 customers. For example, you might see 20 complaints per 1,000 customers.

When using these sites, you do need to use some caution as people are more likely to complain than they are to compliment. When you use a professional source, people from all different situations complete surveys.

You can find rankings based on pretty much any aspect that you find important such as cost, claim processing speed, customer service, and customer satisfaction and so on.

JD Power has an annual claims study that they conduct and then they rank companies based on those results.

You can find sites that offer in depth reviews about insurance companies based on personal experience or in-depth research that allows them to give an accurate review of each company that they are talking about.

When you visit an opinion based site, such as a forum, people are compelled to write something because they are passionate about the subject. This does not always lead to the most subjective of information and should be treated as such.

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Financial Rankings

Another way that insurance companies are ranked is by their financial stability. This type of ranking is not based on how well a company does with customer service issues or how quickly they pay a claim or other concerns of that nature.

Instead, this type of ranking is based solely on an insurance company’s ability to pay insurance claims.

Companies like AM Best and Standard & Poor’s focus on this aspect.

In addition to ranking a company based on their ability to pay claims, these companies will also offer a projection of future stability based on past performance in conjunction with their current performance.

These companies are not funded by insurance companies and will give an honest assessment of a company’s financial ability to pay.

You can access the information from either of these companies online, however, you will need to have the name of an insurance company in mind in order to find the information that you want.

Neither of these sites offers a ranking in order of stability or anything like that.

Getting the Best Insurance

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Getting the best insurance should start with an auto insurance quote. If you start by getting a quote, your research of different companies will go more smoothly.

Progressive, for example, gets excellent consumer ratings, but they may not necessarily have the most affordable auto insurance available.

You will want to choose a high-ranking company, but you don’t want to pay a fortune for your coverage. Using the free online car insurance quotes tool is the fastest way to achieve this goal.

Start with a zip code and find out which car insurance rates and companies fit your needs now!

FREE Car Insurance Comparison

Compare quotes from the top car insurance companies and save!

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