Generally, auto insurance policyholders are very loyal to a point two thirds of them hardly ever shop around for years, even though there are countless advertisements advocating switch and save strategies. Still, having the most loyal following is proof enough that the companies below are doing a few things right so motorists should at least get a car insurance quote from the companies listed below.
Still, starting with a brand name in mind isn’t really the best strategy when it comes to shopping for vehicle insurance. Motorists are usually served better when they unburden themselves from any undue influence and have a “let’s see who will offer me the best rates and coverage” attitude. This way, they start from a point of advantage.
We came up with the below list based on the J.D. Power report and our own research. These companies have strong policyholder following for one reason or the other and are worth considering when you are shopping for vehicle insurance the next time.
List of Automobile Insurers with the Most Loyal Policyholders
- The Hartford
- State Farm
- Liberty Mutual
- AAA Insurers
- Erie Insurance
- Hanover Insurance
One striking point is that several of the auto insurance companies in the list have a strong membership following. USAA serves members of the military and requires qualification-based membership before anyone can even get a quote. The Hartford serves AARP (over 50 club) members. And you need to be an AAA member to buy a policy from insurance providers in the group.
Perhaps knowing they are getting a discount for their membership status creates a false belief that they cannot get cheap auto insurance from other companies. To start with, they would lose their membership discounts. However, there are many other vehicle insurers with so many other saving opportunities with different qualifications requirements.
That is why motorists would often benefit from shopping around. What really counts is the final car insurance quote, which takes many factors and discounts into account to arrive at the figure. Some companies may be heavily advertising that they offer certain discounts. But not only may they not be the cheapest but also they may not even be competitive enough in the market.
State Farm has a different following due to its mutual status and having the largest agency network in the country helps a lot to convince customers to stay with the company. Mutual insurers don’t have shareholders because they belong to the policyholders. So, it isn’t surprising to see Liberty Mutual in there as well.
Although it didn’t make the list, GEICO has a strong following as well. The company works with many associations and organizations to sell car insurance policies through them and this is bound to increase customer retention because they get good discounts for being a member of one of the organizations. They would lose this discount if they were to buy a policy from another company. This may be enough to stop those policyholders in their tracks before even attempting to find if they are getting a good deal overall. Also, having a well-recognized brand would help in convincing people to stay put.
There is an interesting and telling revelation in the J.D. Power report. Progressive is the auto insurance company with the fastest customer gains in the entire USA for the last five years. However, it has been loosing policyholders as well. This suggests that their rise is price driven and they probably attract most price conscious applicants, who leave the company when they find better deals.
Finally, another study suggests that there are many passive loyalists in the industry who stay with their auto insurers more out of inertia than satisfaction. In plain English, they stay because their carrier hasn’t given them a reason to leave. Or they are not willing to go through the trouble of searching through other providers, getting quotes, considering their options and switching. As far as they are concerned, they have insurance and that is that.
The survey suggests that it may be easy for other car insurance companies to dislodge such passive loyal policyholders with little effort and enticement. Perhaps that is why many companies concentrate on price and savings in their advertisements. In any case, it is always a good idea to trust your provider but verify if it is in your best interest to stay with them.