Erie Insurance Cheapest for Drivers With Poor Records
Clearsurance.com recently published its report on the best and cheapest car insurance companies in the U.S.
The study found that the best company depends on an individual consumer’s needs. For example, Erie Insurance has the best rates for drivers with a history of traffic tickets, and State Farm is the cheapest on average overall.
Car Insurance Rate Factors
The Clearsurance.com report explains that several factors go into determining a customer’s car insurance rates. These factors include the following:
- Claims history
- Credit rating
- Driving history
- Marital status
- Vehicle make and model
- ZIP code
There are several more personal and vehicle factors that help insurance companies determine a driver’s risk.
Some factors make sense, like driving history. A driver with several tickets and accidents on their record is a higher risk than a driver with a safe record. But other factors might not be as obvious, like credit rating. Insurance providers have discovered a correlation between risk and credit scores, though. So, in most states, people with higher credit ratings pay lower rates.
Cheapest Car Insurance Companies by Category
Using data analysis, Clearsurance.com discovered which insurance companies offer lower rates in different categories.
- State Farm – Cheapest overall
- Erie – Cheapest for drivers with a history of traffic tickets
- Geico – Best discounts
- Auto-Owners – Cheapest for families
- Metromile – Cheapest for safe drivers
- Farm Bureau – Cheapest for poor credit
- USAA – Cheapest for military personnel
This list is based on averages. Melanie Musson, a nationally recognized car insurance expert with Clearsurance.com, explains, “Just because a company’s average rates are best for a category, people rarely fall perfectly into one company, so comparison is critical to finding the best rates for each situation.”
Car Insurance Companies With Excellent Service
Not only does State Farm have the lowest average car insurance rates in 29 states, they also work through local agents, so customers can build relationships and trust.
Although Erie Insurance isn’t available in most states, they stand out as a top provider. When a driver has an accident on their record, they can expect their insurance rates to increase by 22%. But Erie Insurance only raises rates by 7% on average following an accident.
Auto-Owners Insurance has built a reputation for having excellent customer service. They also have some of the lower rates available for adding a teen to a parent’s insurance policy.
Metromile is a usage-based insurance policy. Instead of paying a fixed rate each month, policyholders pay based on how many miles they drive. Safe drivers, young drivers, people with poor credit, and drivers living in congested areas or high-risk neighborhoods are likely to save the most with Metromile Insurance.
Types of Auto Insurance
No matter what company a person chooses for insurance, they’ll have to determine what level of coverage they need.
Basic liability insurance is required in nearly every state. It covers damage the policyholder causes in an accident. Lenders require borrowers to carry full coverage on cars with a loan. Full coverage is a combination of comprehensive and collision coverage, and many drivers choose to continue carrying it even after the loan is paid off.
Full coverage pays for damage to the policyholder’s vehicle following a crash, weather event, and vandalism or theft.
Personal injury protection (PIP) or MedPay is another coverage required by some states and optional in others. It covers the policyholder’s injury costs following an accident, regardless of who is at fault.
Discovering the Best Auto Insurance Rates
There are several ways to find the cheapest car insurance and maximize savings.
Shopping around for car insurance and collecting quotes can help drivers find the lowest-cost coverage.
Finding discounts and applying them to premiums is another excellent way to save money on car insurance rates. Some companies, like Geico, have more discounts than others, but nearly every insurance company has a list of discounts, from multi-policy car insurance discounts to low mileage discounts.
Raising the deductible will result in lower premiums. When a driver raises the deductible, they assume more risk, and the insurance provider is responsible for less risk. Since insurance premiums are based on risk, insurance companies charge less for lower-risk drivers.
Read Clearsurance.com’s full report here: The Best and Cheapest Car Insurance Companies 2023.