From national carriers to regional boutique insurers, hundreds of insurance companies compete for your business -- from billboards advertisements and television commercials, to online ads and mass mailings. With so many choices to select from, how do you weigh your options and decide which company is right for you? That’s what we’re here to answer.
Finding the best car insurance company, policy and price hinge on a variety of factors -- and the vehicle you drive and the state you live in also play a role in how much you’ll pay for car insurance coverage. The average annual premium for full coverage is $1,771, according to Bankrate, but most of our top car insurance picks have average premiums that are hundreds of dollars less.
If you want to make sure you have the best car insurance coverage and rates possible, here are our recommendations for the best auto insurance companies.
Quick look: Best car insurance providers compared
|Company||Best for||Avg. annual premium for full coverage*||J.D. Power Claims Satisfaction**||A.M. Best Financial Strength Rating***|
|Allstate||High-risk drivers||$2,438||889||A+ (Excellent)|
|Amica||Customer satisfaction||$1,495||895||A+ (Excellent)|
|The Hartford||AARP rates and rewards||$2,002||905||A++ (Superior)|
|Nationwide||Tech-savvy drivers||$1,383||868||A+ (Excellent)|
|State Farm||Most drivers||$1,397||892||A++ (Superior)|
|USAA||Military perks||$1,209||909||A++ (Superior)|
*Overall average annual premiums for full coverage are $1,771.
**Industry average is 880.
***A.M. Best financial strength rating scale runs from D (lowest) to A++ (highest).
Best car insurance companies
How to choose an auto insurance provider
If you’re looking for an insurance provider, follow these steps:
- Determine your needs and preferences. Different providers have different strengths and weaknesses. If you’re looking for the least expensive policy, you may have to sacrifice on customer service support.
- Ask friends and family for recommendations. Check with friends and family in your area to get testimonials about pricing and satisfaction.
- Compare prices. As with any product or service, it’s worth your while to shop around. An independent insurance agent can help you get quotes from multiple providers, or you can use each company’s online quote tool.
How does auto insurance work?
Auto insurance is a financial product that helps you pay for damages to your vehicle and medical expenses in the event of an accident. As a policyholder, you pay a premium (monthly or annually) for coverage. Your premium is priced according to specific factors including your driving history, where you live and what kind of vehicle you drive. Auto insurance typically features a deductible, which is the amount you’ll have to pay out of pocket for repairs and medical expenses before your insurance kicks in.
What does auto insurance cover?
It depends on the type of policy. You can buy a comprehensive policy or a basic one and add options such as roadside assistance.
Different types of auto insurance coverage
Mandatory minimum coverage
A minimum amount of liability car insurance is required in most states. It’s usually called minimum coverage car insurance, and it consists of the following provisions:
- Bodily injury liability protection: This covers injuries to others caused by the policyholder and other drivers listed on the policy.
- Property damage liability protection: This covers damage that policyholders cause to someone else’s property -- most often a car damaged in an accident, but also other personal property like a fence or mailbox.
The amount of bodily injury liability and property damage liability protection needed varies by state.
Some states also require two other types of coverage:
- Personal injury protection: This covers medical costs and lost wages for the driver and passengers in the policyholder’s car if injury occurs, up to the policy’s limits, regardless of fault.
- Uninsured or underinsured motorist coverage: This covers you up to the policy’s limits when an underinsured or uninsured motorist causes an accident.
Optional full coverage
If you want to drive, you’ll need state-mandated insurance coverage. But that typically doesn’t cover any damage to your car in an accident. Coverage for that will require an additional policy or add-on. And if your car is financed, your lender may require you to carry full coverage car insurance, which includes comprehensive coverage and collision coverage.
- Collision coverage: This covers damage to your vehicle in an accident resulting from a collision between your car and another car or an object.
- Comprehensive coverage: This covers damage to your car caused by an event other than a collision with another vehicle, such as theft, fire, flood, hail, hitting an animal and vandalism.
Many insurers also offer additional coverage for specific situations. If you buy a new vehicle, for example, you may want new car replacement coverage, which will pay for a new vehicle of the same make and model if yours is totaled in a covered loss. Here are a few other examples of add-on coverage:
- Roadside assistance: A tow will be sent to you if you’re stranded on the side of the road for any reason.
- Gap coverage: Pays the difference between what your vehicle is worth and what you owe on it.
- Custom parts and equipment coverage: Helps pay for replacement items in your car such as custom wheels or a stereo.
- Rental car reimbursement: Helps pay for rental cars when your vehicle is in the shop after a loss.
Discounted rates and bundling
Auto insurance rates are determined by specific and personal factors such as where you live, your driving record and the type of vehicle you drive. If you’re looking for the best auto insurance rates, however, many companies offer discounts. You may qualify for a lower premium if you maintain a safe driving record or improve your credit score. Young drivers may qualify for a discount by getting good grades. You may also be eligible for a discount if you bundle multiple policies -- that is, if you use the same provider for car insurance, life insurance and homeowners insurance.
How much coverage do you need?
Most car insurance companies offer different policies for different types of drivers. For a baseline, you want a policy that includes bodily injury liability protection and property damage protection. But you may add other coverage types such as personal injury protection, uninsured motorist coverage or collision coverage. Some auto insurance carriers offer comprehensive coverage, which insures your vehicle from theft or damage caused by non-driving incidents such as a fire.
“Having adequate auto insurance coverage is both smart and prudent to ensure you and your family are financially protected from a catastrophic loss,” said Mark Friedlander, director of corporate communications at the Insurance Information Institute. “Comparison shopping when seeking insurance coverage is time well spent as premiums could vary by hundreds of dollars between carriers depending on numerous factors.”
In addition to choosing certain coverage types, you may be able to adjust your deductible -- the amount you pay for a loss before insurance kicks in. If you want a lower monthly premium, you can elect to have a higher deductible. Before you go that route, however, make sure you can cover a significant loss.
How to sign up for auto insurance
Signing up for car insurance is simple. Here are the major steps:
- Gather your personal information. You’ll may have to provide a lot of personal information including your name, driver’s license number, date of birth, Social Security number, type of vehicle, VIN and bank account number.
- Determine your coverage needs. You’ll be asked to select what coverage types and how much coverage you’d like. You may want to work with an insurance agent on this portion.
- Apply online, in person or over the phone. Applying online may be the easiest option, but an insurance agent can walk you through the process in person or over the phone.
- Submit your application and pay your premium. Once you’ve provided all the required information, you can pay your premium each month or via automatic withdrawal.
Car Insurance FAQs
CNET reviews insurance carriers and products by exhaustively comparing them across set criteria developed for each category. For auto insurance, we examine average annual premium rates for full coverage, consumer complaints, collision repair scores, the carrier’s financial strength, auto claims satisfaction and overall customer satisfaction. Our data comes from a multitude of sources.
Auto insurance rates come from Bankrate, which gathers data using Quadrant Information Services. We also use both J.D. Power annual surveys that collect data on customer auto claims satisfaction and overall customer satisfaction.
Consumer complaints are taken from the National Association of Insurance Commissioners (NAIC), which collects consumer complaints across states, indexing complaints on a scale that takes into account the industry average. We collect the financial strength rating of each carrier from the A.M. Best Rating. Lastly, we collected collision repair scores from the Crash Network Insurer Report Card, which collects data from collision repair professionals, including mechanics, to gauge the quality of collision claims service from insurance carriers.