Insurance contracts should be simple—you pick out a policy and diligently pay your premiums. You file a claim with your insurance company after an accident, and they should pay out benefits based on the terms of the policy.
Unfortunately, the insurance industry routinely violates the rights of its policyholders. Things have historically been so bad that each state has a governmental agency dedicated to regulating the industry.
Have you ever wondered what are the worst insurance companies in the U. S. The American Association for Justice (AAJ) put together a detailed list of the ten worst car insurance companies in the U.S. S. The group looked through a lot of public documents, such as court records related to lawsuits, and found the insurance companies most likely to deny claims and keep policyholders from getting benefits they need. We’ll talk about the four worst auto insurance companies and some of the tricks they use to cheat policyholders.
The Top 10 Worst Car Insurance Companies in 2022Finding the right car insurance company can feel like an impossible task. With hundreds of options to choose from it’s tough to know where to start your search. While most major insurance providers offer decent coverage and rates, some stand out as the worst in the industry.
When looking for car insurance you want a company that provides excellent customer service reasonable prices, and a smooth claims process. However, not every insurer checks these boxes. By looking at customer ratings and complaints, you can get an idea of which car insurance companies to avoid.
To help you find the best coverage, we’ve compiled a list of the 10 worst car insurance providers based on customer satisfaction surveys and company complaint records. Keep reading to learn which insurers had the most dissatisfied customers in 2022.
The 10 Worst Car Insurance Companies
- Mercury General Group
For years, Mercury General Group has ranked as one of the worst insurance providers in the nation. The California-based company consistently sits at the bottom of customer satisfaction surveys, like the J.D. Power auto claims satisfaction report.
Mercury also has sky-high complaint numbers. Data from the National Association of Insurance Commissioners (NAIC) shows the insurer had a complaint index score of 3.82 in 2021 – nearly four times higher than the industry average.
With terrible customer service ratings and the most complaints of any large insurer, Mercury General tops the list as the worst car insurance company.
- Progressive Insurance Group
Progressive Insurance bombs when it comes to customer satisfaction. The Ohio-based company scored well below average across all regions in J.D. Power’s latest auto insurance study.
Policyholders frequently complain about denied claims and slow payouts with Progressive. The NAIC complaint index for the insurer was 1.70 in 2021, showing a higher-than-average rate of grievances.
While Progressive offers affordable coverage, lackluster service earns the company a spot as one of the industry’s worst insurers.
- Liberty Mutual Insurance Companies
Liberty Mutual may advertise quality coverage at reasonable prices, but many customers tell a different story. The insurer consistently ranks low in satisfaction with repairs, claims handling, and customer service.
Liberty Mutual’s NAIC complaint score reached 2.22 in 2021 – nearly double the industry standard. For an insurance company of its size, Liberty has an alarmingly high rate of grievances.
Between disappointingly low customer ratings and frequent complaints, Liberty Mutual stands as one of the worst choices for car insurance today.
- Nationwide Group
Nationwide has built a reputation for terrible claims handling and customer service. In a recent J.D. Power survey, the company scored well below competitors for satisfaction with the claims process.
Reviews on sites like Consumer Affairs highlight this problem, with customers consistently complaining about delayed payments, denied claims, and unhelpful agents. Nationwide’s NAIC complaint index reached 1.18 in 2021, showing an above-average rate of issues.
With so many dissatisfied customers, it’s clear Nationwide has room for improvement when it comes to auto insurance service.
- Allstate
Known for catchy advertising and widespread availability, Allstate fails to satisfy in customer service and claims handling. The Chicago-based insurer consistently scores below competitors in satisfaction surveys.
Allstate also has sky-high complaint numbers for an insurer of its size. The company’s NAIC complaint ratio was 2.73 in 2021 – more than double the industry average.
While Allstate offers standard coverage and rates, lackluster service and frequent issues continue to make this a worst-choice insurer.
- Farmers Insurance
Farmers Insurance customers frequently complain about terrible service when filing claims. The company sits near the bottom of industry rankings for timely payments, responsive agents, and helpful adjusters.
Like other insurers on this list, Farmers’ NAIC complaint ratio far outpaces competitors. With a score of 3.63 in 2021, the company sees complaints at more than triple the standard rate.
Though Farmers sells affordable policies nationwide, poor claims handling and unhappy customers earn the insurer a spot among the industry’s worst.
- Berkshire Hathaway Insurance Group (GEICO)
Berkshire Hathaway, the parent company of GEICO, typically offers low rates and widespread availability. However, customers often report major issues when filing claims with the provider.
In J.D. Power’s latest auto claims satisfaction report, GEICO scored below competitors in all study regions. The insurer sees frequent complaints over unfair payouts and claim denials.
GEICO’s NAIC complaint ratio also outpaces many leading insurers. While the company isn’t the worst, lackluster claims service makes this a low-ranked option.
- State Farm
State Farm is the country’s largest insurer, but being big doesn’t mean providing the best service. Customers routinely complain about terrible experiences when filing claims through State Farm.
The company scored particularly low on payments for injuries and vehicle damage in a recent J.D. Power satisfaction study. State Farm’s NAIC complaint index reached 1.44 in 2021, showing a higher-than-average number of grievances.
Though State Farm offers affordable rates and widespread availability, poor claims handling continues to plague the insurer.
- 21st Century Insurance
21st Century Insurance, sold by Farmers, consistently earns low marks across customer service, pricing, and claims. Policyholders frequently complain about sky-high premiums, policy non-renewals, and claims denials.
21st Century scored far below competitors in many regions of the J.D. Power auto claims satisfaction study. With an NAIC complaint index reaching 4.30 in 2021, the company sees grievances at more than four times the standard rate.
Terrible service and frequent issues clearly make 21st Century Insurance a worst choice for car insurance customers today.
- The General Insurance
The General Insurance positions itself as an option for high-risk drivers who struggle to find affordable coverage. However, customers often complain about terrible experiences with the insurer.
In reviews and surveys, policyholders consistently highlight issues with denied claims, expensive policies, and unhelpful agents. The General’s NAIC complaint ratio reached an astounding 11.30 in 2021 – ten times higher than leading competitors.
With sky-high prices, terrible service, and abundant complaints, The General stands out as a definite worst choice for car insurance coverage.
How to Choose the Best Car Insurance Company
As this list shows, some auto insurers consistently fail to satisfy customers. However, the right provider for you depends on your individual needs and preferences. Here are some tips for choosing quality car insurance:
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Compare quotes from multiple companies. Rates and coverage options can vary widely between insurers.
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Look at customer satisfaction scores. Ratings on third-party sites can highlight companies with the best service records.
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Research complaints and financial strength. You want a reliable insurer with few issues.
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Consider discounts and extras. The best company offers savings and perks tailored to you.
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Evaluate service and support. Test drive customer service before purchasing a policy.
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Understand exclusions and limitations. A cheap policy is no good if it doesn’t cover your needs.
Finding the perfect car insurance company takes effort. By avoiding the worst and focusing your search, you can land quality coverage at an affordable rate. Remember to shop around and compare your options.
The best insurer for your friend or neighbor may not suit your needs. But by starting your search with the worst companies to avoid, finding the right fit for your vehicle becomes much simpler.
Worst Insurance Companies in America
Most insurance companies are known for their claim denials. Surprisingly, some of the biggest offenders make well over a billion dollars in profits on policyholders’ backs. Here are some of the biggest offenders:
The AAJ report named this big insurance company the worst because it is rude to its own policyholders. The AAJ report says that the consulting firm McKinsey came up with this strategy to help Allstate make more money. Unfortunately, McKinsey did not recommend that Allstate improve its service to win new customers and boost revenue.
Instead, Allstate’s strategy for boosting profits includes:
- Making low-ball settlement offers that are worth a lot less than the insurance claim
- Not changing their minds about the initial settlement and instead going to court (this is known as the “boxing gloves” strategy)
- Putting off claims so that people will be desperate and agree to a low settlement
Texas also fined Allstate for charging too much for homeowners insurance in the state. This is another dishonest way that Allstate has tried to boost its profits.
Located in Bloomington, Illinois, State Farm ranked #4 on AAJ’s list for worst insurance companies. We want to draw attention to them because they are one of the biggest car insurance companies, which is useful after an accident. They also provide homeowners policies, which are frequently at issue in dog bite and premises liability claims.
The 3D method is used by both Allstate and State Farm for handling claims: deny claims, delay any payments that are due, and then defend with lawsuits. The company also has a history of failing to renew policies.
Farmers Insurance is a California-based company that sells both home and car insurance. Customers consistently rate them as one of the worst car insurance companies in the country.
A 60-year-old woman in Washington State was in a car accident that put her in a coma for more than a week. Farmers were in the news because of this. Farmers first said no to her claim, saying that the driver who hit her did it on purpose because they were angry about traffic. The Washington State Insurance Commissioner had to intervene before Farmers reversed course and paid out benefits.
Liberty Mutual rounds out our list of worst insurance companies. Like Allstate and State Farm, Liberty Mutual also hired the same consulting firm Mckinsey & Co. And as they did with the other insurers, Mckinsey & Co. recommended that Liberty Mutual deny and delay as many claims and payments as possible, even valid claims.
Liberty Mutual has its fair share of complaints, but not as many as some of the other car insurance companies above. Liberty Mutual has a history of facing litigation from policyholders. Liberty Mutual has been accused of wrongfully not renewing the policies of policyholders who were thought to be likely to file claims. This is in addition to its “deny, delay, and defend” strategy.
Worst Car Insurance Companies Honorable Mentions
We would be missing something if we didn’t list a few more American insurance companies that have been named among the worst in the U.S. S. These include:
These are the best- and worst-rated car insurance companies
FAQ
What is the #1 auto insurance in the US?
Which insurance company has the most complaints?
What insurance company is most reliable?
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Insurance company
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Best for
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Geico
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Best overall
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Check availability
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Progressive
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Best for high-risk drivers
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Check availability
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Safeco
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Best for added perks
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Check availability
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Auto-Owners
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Best for coverage on a budget
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Check availability
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Who is the best car insurance company?
USAA was first place in the Zebra’s Customer Satisfaction Survey. Erie Insurance came int second on our list of best car insurance companies with an overall score of 8.5. American Family came in third place overall with a score of 8.4 out of 10. Below you’ll find the remaining top 10 large auto insurance carriers.
Who is the worst car insurance company?
While no one company claims the title of worst car insurance provider, there are ways to judge them. Check out a company’s NAIC complaint index score and BBB rating before choosing an auto insurance company. From large national companies to small, local businesses, it seems like there are a thousand choices when it comes to car insurance.
Which car insurance company has the lowest BBB rating?
As you can see, AAA has the worst NAIC score, while Esurance has the lowest BBB rating. However, you should be cautious of BBB ratings — a company can have hundreds of unresolved complaints and a high rating. Enter your ZIP code below to view companies that have cheap auto insurance rates. Which car insurance companies have the highest rates?
Which car insurance companies have dropped in the last year?
Compared to last year, car insurance company rankings have significantly dropped across the board. Consider USAA: While this company has consistently been a top pick for Clark and ranked highly with J.D. Power and Consumer Reports, their company rating according to J.D. Power has decreased over the last two years.