A poor driving record can push you into the “high-risk” car insurance market, which means you can wave goodbye to the best auto insurance quotes. But you still have plenty of choices for insurance companies — some better than others.
Many companies specialize in “nonstandard” drivers, which include people who: have tickets or DUI convictions; are newly licensed; are elderly; have a foreign driver’s license; have poor credit; have allowed their coverage to lapse; want to buy only the minimum required coverage; or own an exotic vehicle.
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Many major insurance companies will insure nonstandard drivers, often through special subsidiaries. In addition, many smaller insurers specialize in the nonstandard market.
To find the best car insurance for high-risk drivers, NerdWallet looked at upheld complaints against these companies, using data from the National Association of Insurance Commissioners. We also looked at financial strength from ratings company A.M. Best.
Best car insurance companies for high-risk car drivers
Geico Casualty is Geico’s subsidiary for high-risk drivers. Customers don’t apply to a particular Geico subsidiary. Rather, the insurer assigns one based on the driver’s risk factors. Geico, the nation’s second-largest car insurance company by premiums written in 2013, is a subsidiary of Warren Buffett’s Berkshire Hathaway Inc. Geico has more than 13 million policies in force, covering more than 22 million vehicles.
Dairyland specializes in nonstandard auto policies and motorcycle coverage. It’s a mutual insurance company, meaning policyholders are part owners of the company. Sentry, part of the Sentry Insurance Group, was founded in 1904 by members of the Wisconsin Retail Hardware Association. The company has more than 1.1 million policyholders.
Titan is a nonstandard subsidiary of insurance giant Nationwide, which was the nation’s eighth- largest company by car insurance premiums written in 2013, according to the Insurance Information Institute. Titan says it and its sister companies (Victoria Insurance and Colonial County Mutual Insurance) together are the nation’s third-largest writer of specialty insurance.
Ranking nonstandard car insurance companies
Here’s a closer look at the numbers behind the best three companies and their competitors.
|Complaints against nonstandard car insurance companies|
|These “complaint index” numbers divide a company’s share of total complaints by their market share. An index number of 1 is the industry median. A higher index number means more complaints. Lower numbers are better. Financial strength ratings reflect to a company’s ability to pay claims. A.M. Best considers companies with ratings of B and below to be “vulnerable.”|
|Rank by avg. complaints||Company||2014 complaint index||2013 complaint index||2012 complaint index||Average complaint index||A.M. Best financial strength rating|
|1||Geico Casualty||1.1||1.3||1.3||1.2||A++ (Superior)|
|4||Safe Auto||3.4||1.2||1.8||2.1||A+ (Superior)|
|7||Bristol West2||2.3||2.6||2||2.3||A (Excellent)|
|10||The General3||3.7||3.8||3.4||3.6||A- (Excellent)|
|11||Alliance United||5.3||4.5||2.4||4.1||Not rated|
|12||Direct General||6.4||2.5||4||4.3||B (Fair)|
|13||United Automobile||8.2||5.3||3.6||5.7||C (Weak)|
1 Subsidiaries of Nationwide Insurance
2 Subsidiary of Farmers Insurance
3 Subsidiary of American Family Insurance
Sources: Complaint data from the National Association of Insurance Commissioners, A.M. Best ratings as of Sept. 5, 2015.
NerdWallet also looked at the top reasons for consumer complaints against these insurers. The reasons were unsatisfactory settlements, denial of claims and delays.
As the numbers show, all these nonstandard insurers have proportionately more upheld complaints against them than the industry median. But that might be because drivers forced into the nonstandard market could be less satisfied because they feel that they have less choice, according to Jeanne Salvatore, a spokeswoman for the Insurance Information Institute, an industry trade group.
“Insurance is a highly competitive business,” she says. “Most people can choose amongst many companies.”
But that doesn’t necessarily mean that nonstandard companies may feel less pressure to provide good service. “No company wants their customers to be unhappy,” Salvatore says.
If you’ve been pegged as a high-risk driver and want to comparison shop for car insurance quotes, contact an insurance agent or go directly to companies. NerdWallet’s car insurance comparison tool can also help you find rates.
Updated Sept. 15, 2015