Do Credit Unions Offer Car Insurance?

When it comes time to shop for car insurance, most people automatically turn to big national insurance companies like Geico, State Farm, and Allstate But did you know that many credit unions now offer competitive auto insurance policies as well?

In fact, credit union car insurance has become an increasingly popular option for many drivers looking to save money on their coverage. Credit unions like RBFCU provide personalized service and exclusive member discounts that can make their car insurance rates very attractive.

So should you consider getting your auto insurance from a credit union? What are the potential benefits and drawbacks? Let’s take a closer look at what credit unions have to offer when it comes to car insurance.

Overview of Credit Union Car Insurance

Credit unions are non-profit financial cooperatives that exist to serve their members. They originally started out providing savings accounts and loans, but over time have expanded to offer many other financial services like checking accounts, credit cards, retirement plans and insurance products.

Most large credit unions now have an insurance division that provides coverage options for

• Auto insurance
• Homeowners/renters insurance
• Life insurance
• Health insurance

The auto insurance policies available from credit unions provide all the standard types of car insurance coverage, including:

• Liability – covers injury and property damage you cause to others
• Collision – covers damage to your vehicle from an accident
• Comprehensive – covers damage to your car from theft, vandalism, weather, etc.
• Uninsured/underinsured motorist – covers injury costs when the at-fault driver has no or minimal insurance
• Medical payments – covers medical bills for you and passengers
• Personal injury protection – pays for lost wages, medical bills, and services

Credit unions partner with well-known insurance companies to underwrite their policies. So you can rest assured the coverage meets all state legal minimums and provides robust protection.

What Are the Benefits of Credit Union Car Insurance?

There are several advantages to getting your auto insurance from a credit union rather than a traditional insurer:

Lower Rates

Credit unions don’t need to generate profits for shareholders. So they can pass savings on to members in the form of lower insurance premiums. Average credit union car insurance rates run about $250 less per year compared to big national insurers.

Member Discounts

Most credit unions provide special discounts exclusive to their members. Common auto insurance discounts include:

• Multi-policy discounts – 5% to 15% off for bundling home and auto insurance
• Good driver discount – 10% off for a clean driving record
• Auto loan discounts – up to 15% off for financing through the credit union
• Defensive driver discounts – for passing an approved safety course
• Low mileage discounts – for driving less than a specified mileage per year

Personalized Service

You’ll work directly with a credit union insurance agent when getting quotes, selecting coverage, and filing claims. They know you by name, not just a policy number. This personalized service can make the insurance process smooth and hassle-free.

Non-Profit Status

Credit unions exist only to serve members, not turn big profits. So you can trust that their insurance agents have your best interests in mind when recommending coverage options. There are no high-pressure sales tactics.

Dividend Payments

Some credit unions issue dividend payments to eligible auto insurance policyholders at the end of underwriting periods when claims are lower than expected. This acts as a partial refund on premiums paid.

Borrow Against Paid Premiums

A unique credit union insurance perk is that members can actually borrow against the premium amounts they have paid at very low interest rates. Accessing your paid insurance equity can help cover emergency costs.

What Are the Potential Drawbacks?

While credit union car insurance has many benefits, there are a few potential downsides to consider as well:

• Limited provider networks – For repairs, credit unions may only work with certain body shops. Big insurers offer more choices.

• Website experience – Credit union insurance sites tend to be less advanced. They may lack online quote tools, policy management, etc.

• Fewer discounts – Insurers offer more discounts, like for anti-theft devices, student away at school, accident prevention courses, etc.

• Unknown reputation – Major insurers have established reputations. Credit union insurance divisions are still building trust.

• Lack of agents – Credit unions tend to have fewer local insurance agents than big companies. Less choice can be inconvenient.

However, for many members the perks like lower rates and personalized service outweigh these limitations.

How Much Can You Save with Credit Union Car Insurance?

The average savings with credit union auto insurance is around $250 per year. However, actual savings can vary quite a bit depending on your age, driving record, vehicle, location, and other factors.

To get an idea of the potential savings for your situation, it’s best to get quotes from both credit union providers and national insurance companies. You can then compare them side by side along with coverage amounts.

Here’s an example cost comparison for a 30 year old driver with a clean record insuring a 2015 Honda Accord in Texas:

In this scenario, the credit union provided a premium that was $314 less than State Farm, $581 less than Allstate, and $722 less than Farmers annually. That’s over 20% in savings.

Of course, pricing varies by many factors. But this example illustrates how credit unions can frequently beat the big insurers on annual car insurance premiums.

Who Offers the Lowest Credit Union Car Insurance Rates?

The credit unions known for having the most affordable car insurance rates include:

• State Farm Credit Union – They offer highly competitive rates given their partnerships with State Farm Insurance. Bundling home and auto insurance can net over 15% in discounts.

• Alliant Credit Union – Alliant is one of the larger credit unions. Member pricing on auto insurance provided by MetLife is tough to beat.

• America First Credit Union – America First is based in Utah but offers members nationwide low rates on Liberty Mutual auto insurance policies.

• Affinity Federal Credit Union – New Jersey based Affinity partners with Travelers Insurance to offer some of the lowest car insurance rates to members.

• RBFCU – Texas’ Randolph-Brooks FCU collaborates with national insurers to provide members exclusive discounted pricing on auto insurance.

When comparing credit union insurance providers, get multiple quotes. Rates can vary significantly between credit unions even for the same individual driver and vehicle.

How Does Credit Union Insurance Handle Claims?

Credit unions provide insured members with excellent service during the claims process:

• Report your claim to your credit union insurance agent quickly after an accident.

• Adjusters contracted by the credit union’s partner insurer will be assigned to assess damage, determine fault, and settle the claim.

• Keep in regular contact with your insurance agent throughout the claims process for updates and assistance as needed.

• The credit union has incentive to provide thorough yet rapid claims service to keep you as a satisfied member.

• Payouts for covered losses are the same as with a standard insurer. The credit union’s underwriting partner handles payments.

• In the rare event of a denied claim or lowball settlement offer, you can request the credit union insurance agent go to bat for you with their contracted insurer.

Is Credit Union Car Insurance Right for You?

The bottom line is that credit union auto insurance provides a smart alternative for many drivers looking to maximize savings and minimize hassles when it comes to protecting their vehicle.

You benefit from competitive member pricing as well as attentive service from an agent who knows your name. Just make sure to compare quotes from the credit union and national insurers to confirm the credit union comes out cheaper.

For the best deal on credit union car insurance tailored to your situation, contact the RBFCU Insurance Agency today at 1-888-564-2999. Or request a free quote online now to get a personalized premium estimate.