Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Written by Rachael Brennan
Licensed Insurance Agent Rachael Brennan

Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Reviewed by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

UPDATED: Jun 29, 2022

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In a nutshell...

  • Rules and regulations and specific coverage amounts vary significantly from state to state
  • Collision coverage is optional for drivers who own their vehicles outright
  • Coverage for damage sustained to an automobile or other property is also required in most states

The best car insurance companies are those that offer competitive pricing, reliable coverage, and great customer service but there are some which far exceed others regarding price, customer service, and reputation.

Every state in the union requires motorists to carry some form of liability insurance protection.

With more than 260 million passenger vehicles registered in the United States, the car insurance business is probably the most competitive segment of the insurance industry.

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Where can I compare car insurance companies?

In most states, there are 100 to 200 licensed car insurance companies ready, willing and able to provide you with car insurance coverage.

Auto insurance is also the most widely advertised insurance product in the marketplace today. However, the biggest company, or the one that advertises the most, is not necessarily the best choice for your auto coverage.

Private research companies such as J. D. Powers and Associates, conduct annual surveys to rate how satisfied consumers are with a large variety of products and services.

The top four are regional companies that only some will recognize:

  • Amica Mutual
  • Erie Insurance
  • Auto-Owners’s Insurance
  • Shelter

Numbers five and six are well-known national brands, State Farm and Geico and rounding out the top ten are Liberty Mutual, American Family, Country and Alfa Insurance.

The next ten on the 2010 survey are:

  • Ameriprise
  • Automobile Club of Southern California (ACSC)
  • Progressive
  • Kemper
  • State Auto
  • The Hartford
  • Grange
  • Allstate
  • Travelers
  • Automobile Club Group

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When did auto insurance coverage begin?

The first automobile accident recorded in America occurred in March of 1896 in New York City.

This was just two short months after the first commercial automobile, manufactured by the Duryea brothers in Chicago, was produced.

The victim, riding a bicycle, suffered a broken leg, while the driver spent the night in jail for his contribution. Three years later, in 1889, the first automobile insurance policy was sold

It is not surprising that soon after this incident the Travelers Insurance Company wrote the world’s first auto insurance policy.

In 1897, Gerald Loomis purchased a liability policy protecting others against injury and providing coverage for property that might be damaged because of his driving.

What kinds of protection should my car insurance policy offer?

Most states require at least primary liability insurance, covering expenses relating to the injury or death of a single individual or multiple individuals.

Coverage for damage sustained to an automobile or other property is also required in most states.

While there are mandatory coverage minimums, higher coverage limits are usually recommended.

What are the other types of available coverage?

When bank financing is used to purchase a vehicle, the lender will require collision coverage. This ensures that the vehicle owner will be able to afford repairs to a car that’s been involved in a severe accident.

Often, there is an out-of-pocket deductible portion that the policyholder is required to pay. Comprehensive coverage covers minor vehicle damage, primarily glass, and is usually included in a basic liability package.

Other add-ons may include coverage for rental cars, towing and other roadside assistance, and medical coverage for expenses not covered by the driver’s regular health insurance plan.

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What is “no-fault” car insurance?

Liability coverage alone does not protect the driver who causes an accident, or his or her property.

In the 1970s, most states enacted “no-fault” legislation to protect drivers who are involved in a single vehicle accident or a mishap with another driver who has no insurance.

When involved in this type of an accident, the driver’s carrier picks up the tab for the policyholder’s medical expenses and any damage incurred.

Today, no-fault premiums are a required part of auto coverage in most states. As with other insurance products, no-fault terms may vary from state to state.

Will my rates go up if I have an accident or get a traffic ticket?

Yes and no. This depends on the company and the seriousness of the accident or infraction.

Many companies will forgive a minor accident, or a single traffic offense, for long-time policyholders, if there have been no recent claims against the policy or other issues.

Serious accidents or traffic violations will most certainly bring higher rates at renewal time.

Some companies specialize in providing insurance protection for drivers who are considered high risks, because of the number of moving violations they’ve sustained or the number or seriousness of accidents they’ve been involved in.

People in these circumstances can obtain required liability coverage but will pay significantly higher premiums.

How can I reduce my car insurance premiums?

Driving safely is a great way to reduce your premiums! However, if you do incur a traffic violation that includes points on your license, you may take a safe driving class through your local automobile club or other agency.

Most auto insurers will accept a certificate of completion from these courses in exchange for a policy discount.

In many areas, students and other new drivers are required to take driver’s education classes. These classes may also qualify drivers for discounts.

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