Auto Insurance Basics

The Top Ten Largest Auto Insurance Companies of 2018

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The auto insurance market in the U.S. is dominated by a few key players. In fact, the top ten auto insurance companies control more than 70% of the market. While the top ten insurance companies underwrite a large number of policies, they have very distinct characteristics. To help you choose the best insurer for your situation, we created a list of the top ten largest auto insurance companies in the U.S. and discussed what makes each of them unique.

RankAuto Insurance CompanyPremiums Underwritten ($bn)Market ShareAdditional Reading
1State Farm$39.218%Read More
2GEICO$25.512%Read More
3Allstate$20.810%Read More
4Progressive$19.69%Read More
5USAA$11.75%Read More
6Liberty Mutual$10.85%Read More
7Farmers$10.35%Read More
8Nationwide$7.64%Read More
9American Family$4.02%Read More
10Travelers$3.92%Read More

What are the Biggest Auto Insurance Companies?

When looking at the rankings of the top insurance companies in the United States, most of the names are recognizable due to their national television advertising campaigns. The top ten insurance companies offer varied insurance rates, customer claims experience and features. We discuss the top ten biggest auto insurance companies in the U.S. and what you should know about each of them below:

Market Share of the Largest Auto Insurance Companies in the United States

1. State Farm

State Farm operates as a mutual insurance company, meaning that it’s owned by its policyholders. State Farm is the largest auto insurance company in the U.S. and possesses 18% of the total available market share. Nearly one in five dollars spent on private passenger auto premiums in the U.S. is paid to State Farm. The company currently employs approximately 70,000 employees and has nearly 19,000 agents. Despite its large market share, State Farm’s latest annual report shows a net loss of over $2.6 billion dollars.

Our Thoughts: State Farm is a great auto insurance company for anyone who wants a local agent and a personalized insurance experience. However, State Farm doesn’t typically offer drivers the most competitive rates. If you want or need a curated experience, and are willing to pay for it, State Farm is a great choice.

Rank Five Years Ago: #1

2. GEICO

GEICO, well known for its animated gecko, has served as an underwriter to more than 16 million auto policies, which insure more than 24 million vehicles. The company’s size allows it to employ more than 36,000 people across nine regional offices, three service centers and three claims centers. GEICO’s original customer base consisted of U.S. government employees and military personnel. Today, the insurance company’s customer base has expanded to include people in the private sector.

Our Thoughts: We consider GEICO to be one of the best auto insurance companies. GEICO offers low rates, national availability and an easy shopping experience. If you’ve had a prior accident, however, you’ll likely receive unfavorable rates from GEICO.

Rank Five Years Ago: #3

3. Allstate

Established in 1931, Allstate is the largest publicly traded property and casualty insurance company in America. Similar to State Farm, Allstate has a roster of local agents ready to serve your needs. The company currently employs over 79,000 people. Esurance, a subsidiary of Allstate, operates in the same space. According to Allstate, the Esurance brand is targeted towards self-directed and brand-sensitive customers while Allstate is geared for customers who enjoy local and personal service.

Our Thoughts: We consider Allstate to be a middle-of-the-road insurance company due to its high rates and average claims satisfaction ratings. Allstate’s redeeming factors are the wide variety of discounts that it makes available to its customers.

Rank Five Years Ago: #2

4. Progressive

Progressive—the fourth biggest insurance company in the country—was established in 1937. The company offers the ability to purchase auto insurance directly, online or by phone. Alternatively, customers can sign up through independent insurance agents. The company employs over 33,000 people and has over 400 offices. Progressive, like Allstate, is a publicly traded company.

Our Thoughts: Progressive offers highly competitive rates to drivers with previous accidents. However, claims satisfaction ratings and coverage options are average at best. Due to this, we recommend for prospective Progressive customers to shop around and compare rates before signing up.

Rank Five Years Ago: #4

5. USAA

USAA was founded by 25 Army officers who decided to insure each other’s vehicles in 1922. Today, the company serves millions of members associated with the U.S. military, including:

  • Current Military Members
  • Former Military Members
  • Family of Military Members
  • Cadets or Midshipmen

USAA is headquartered in San Antonio, Texas. The corporate campus’ length extends three-quarters of a mile. USAA is the largest private company in San Antonio.

Our Thoughts: USAA is one of the best auto insurance companies in the country. If you meet their qualification criteria, you enjoy competitive rates, great customer service and speedy claims responses. The only downside of USAA is its restricted membership.

Rank Five Years Ago: #6

6. Liberty Mutual

Liberty Mutual is one of the top insurance companies in the U.S. and has been around for over 100 years. Liberty Mutual also has large international presence—with operations in 17 countries. The international companies sell property and casualty, health and life insurance policies. The auto insurance industry is a large part of Liberty Mutual’s business, representing 36% of their net written premium from insurance as of their latest annual report.

Our Thoughts: Liberty Mutual is a mediocre insurance company. The competitiveness of Liberty Mutual’s car insurance rates will depend on your geographic location. While this is often true with most insurers, Liberty Mutual’s rates vary more than typical. In addition, Liberty Mutual’s customers rank the insurance company’s claims satisfaction process as below average.

Rank Five Years Ago: #7

7. Farmers

Farmers began as an insurance company providing coverage to rural farmers’ vehicles. Since then it has evolved to become the seventh largest insurance company in the country. It’s hard to find an insurance company that offers more products than Farmers. It offers basic auto insurance, pet insurance, and even investment products among a variety of other insurance products. Farmers employs nearly 21,000 people, which allow it to underwrite over 19 million policies across 50 states.

Our Thoughts: Farmers offers decent discounts, coverage options and great customer service. Ultimately, Farmers’ non-competitive rates hold it back from becoming a great auto insurance company.

Rank Five Years Ago: #5

8. Nationwide

Nationwide, a Fortune 100 company, paid over $17 billion in claims and other benefits to members in 2016. The company does business across several verticals—including financial services, commercial lines and personal lines—in all 50 U.S. states. Nationwide has contributed nearly $400 million to nonprofit organizations since 2000.

Our Thoughts: Despite Nationwide not being the most affordable insurance company, its customer reviews tend to be positive. The company offers customers the standard coverage and discounts that you’d expect from a large national insurance company.

Rank Five Years Ago: #8

9. American Family

American Family was established with the initial goal of insuring farmers. In the 1930s, the company expanded and began to focus on insuring non-farmers as well. Today, the company is one of the biggest insurance companies in the U.S. In 2016 alone, American Family paid out over $3 billion in home, auto and umbrella insurance claims.

Our Thoughts: If you’re looking for auto insurance, consider other options. Customers complain online about American Family's slow and unresponsive claims process. Additionally, the company has limited coverage across the country when compared to its peers.

Rank Five Years Ago: #10

10. Travelers

Travelers is more than 160 years old, making it one of the oldest insurance companies operating today. In fact, Travelers issued its first auto insurance policy in 1897, before the Ford Model-T was invented. The company has over 30,000 employees and 13,500 independent agents and brokers in multiple countries—including the United States, Canada, and Brazil.

Our Thoughts: Low complaint ratings and competitive rates make Travelers an excellent choice for auto insurance coverage. In particular, Travelers offers great rates for families with clean driving histories. However, drivers with previous accidents and violations should steer clear as Travelers’ rates rise significantly with an accident on record.

Rank Five Years Ago: #9

Mutual vs Stock Insurance Companies

If you value having a say in how your insurance company operates, consider whether to select a mutual or stock insurance company. The main difference between mutual and stock insurance companies is the ownership configuration—stock insurance companies are privately or publicly owned companies that offer voting rights to stockholders. Mutual insurance companies, however, are owned by their policyholders.

Since stockholders benefit from the stock’s appreciation, people argue that the short-term interest of investors don’t always align with the long-term interest of the company. Many feel that mutual insurance companies are better because the policyholders’ interests align well with what’s best for the company, specifically lowering insurance rates and paying out dividends to attract more customers. Below, we list the top ten insurance companies by type:

Mutual Insurance CompaniesStock Insurance Companies
State FarmGEICO
Liberty MutualAllstate
American FamilyProgressive
NationwideFarmers
Travelers
*USAA is an insurance exchange

Big vs Small Insurance Companies

The trade-off between large insurance companies and small ones typically involves giving up competitive rates for an improved customer experience. When using a small insurance company for your auto insurance, you’ll likely communicate exclusively with one insurance agent. While you generally lose a personal connection when selecting a large national insurance company, the large auto insurance companies tend to have more financial stability. In fact, the top insurance companies in the country underwrite and pay out billions of dollars per year. Additionally, the large insurance companies are able to leverage their resources to offer drivers lower insurance rates.

It’s possible that you’ll have to worry about solvency if you choose a policy from a small company. If you manage to find a small insurance company with a base level of financial stability that you’re comfortable with, consider how much in price you’re willing to pay for better service. If you value great service, you might prefer a small insurance company.

Another consideration when choosing between a large and small auto insurance company is availability, coverage options and discounts. While you’re likely to have a better experience with a small insurance company, it may not have the availability, benefits and discounts that large insurance companies do. For example, the major insurance companies in the U.S. often have representatives that are available 24/7. Additionally, small insurance companies don’t typically offer the long list of discounts and coverage options that national insurers, like Allstate and State Farm, offer. If around the clock availability or having discounts and coverage options are important to you, consider a large insurance company.

Our Favorite Small Insurance Company: Amica Insurance

Sources:

National Association of Insurance Commissioners

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