When it comes to choosing the right auto insurance provider, Allstate and State Farm are two prominent options that often come to mind. Both companies have established their reputations in the industry and offer a wide range of coverage options. However, there are significant differences to consider, especially in terms of affordability. In this comprehensive comparison, we will delve into the rates, coverages, discounts, and customer service offered by Allstate and State Farm. By the end, you should have a clearer understanding of which provider is the best fit for your car insurance needs.
Allstate: A Closer Look
Overview and History
Allstate, founded in 1931, is currently the fourth-largest auto insurance provider in the United States. It holds a market share of 10.4% in the car insurance industry, writing $27.2 billion in premiums in 2021. Originally selling auto insurance through the Sears catalog, Allstate has since expanded nationwide. However, it is important to note that discounts and add-on coverages may vary by state.
Coverage Options
Allstate offers a comprehensive range of standard coverages, including bodily injury and property damage liability insurance, uninsured motorist protection, collision coverage, and comprehensive coverage. In addition to these common insurance products, Allstate also provides add-on policies such as gap insurance, which covers the difference between your car’s value and what you owe on it in the event of a total loss.
Usage-Based Insurance
Allstate’s telematics insurance program, known as Drivewise®, provides drivers with the opportunity to unlock savings by activating the program for free in the Allstate mobile app. Drivewise not only tracks safe driving behaviors to earn discounts but also includes a crash detection safety feature that helps drivers call for help after an accident. While available in 49 states, eligibility for certain discounts may vary in Arkansas, New York, and North Carolina.
Cost and Discounts
In terms of cost, Allstate’s rates tend to be higher than the national average for many types of drivers. However, the exact premium you’ll pay depends on various personalized factors such as age and driving history. Allstate offers several discounts to help offset these costs, including multi-policy, multi-car, good student, safe driving, accident-free, and defensive driving discounts.
State Farm: A Closer Look
Overview and History
State Farm, celebrating its 100th anniversary in 2022, is one of the leading auto insurance providers in the United States. With a 15.9% market share in 2021, State Farm wrote over $41.6 billion in auto insurance premiums during the year. The company boasts more than 19,000 insurance agents nationwide and offers coverage in all states except Massachusetts and Rhode Island for new policies.
Coverage Options
Similar to Allstate, State Farm provides a wide range of standard coverages, including bodily injury and property damage liability insurance, collision coverage, comprehensive coverage, and more. Additionally, State Farm offers a benefit called Payoff Protector®, which covers the difference between what you owe on your car and its value in the event of a total loss. However, this benefit is only available to customers with a loan contract from State Farm Bank.
Usage-Based Insurance
State Farm’s usage-based program, Drive Safe & Save™, allows drivers to earn discounts by maintaining safe driving habits. The program tracks various driving behaviors such as acceleration, cornering, braking, as well as the times of day you drive the most and your phone usage in the car. However, Drive Safe & Save is not available to drivers in California, Massachusetts, or Rhode Island, and eligibility for certain discounts may vary in North Carolina.
Cost and Discounts
State Farm is known for its affordability, with rates that consistently fall below the national average. The exact cost of your premium will depend on individual factors such as age and driving history. State Farm offers various discounts to help customers save, including multi-policy, multi-car, good student, safe driving, and accident-free discounts. However, it’s worth noting that State Farm does not offer a pay-in-full discount.
Comparing Allstate and State Farm
Rates and Affordability
When it comes to rates, State Farm generally offers more affordable premiums compared to Allstate. In a review of the best car insurance companies in 2023, State Farm received a higher rating for cost (9.3 out of 10) while Allstate received a lower rating (7.4 out of 10). State Farm’s average annual rate falls well below the national average, while Allstate’s rates are significantly higher.
To provide a clearer picture, let’s consider some cost estimates for different driver profiles:
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Good driver, good credit, age 35:
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Allstate cost estimate: $2,598
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State Farm cost estimate: $1,657
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Teen driver (age 16):
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Allstate cost estimate: $11,263
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State Farm cost estimate: $5,514
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Has a recent car accident:
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Allstate cost estimate: $4,094
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State Farm cost estimate: $1,953
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Has a recent speeding ticket (16-20 mph over limit):
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Allstate cost estimate: $3,012
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State Farm cost estimate: $1,872
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Has a driving under the influence (DUI) conviction:
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Allstate cost estimate: $3,803
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State Farm cost estimate: $2,194
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Discounts and Customer Experience
Both Allstate and State Farm offer various discounts to help customers save on their premiums. While there are similarities between the discounts offered by the two providers, there are also some differences. For example, State Farm does not offer a pay-in-full discount, but it does provide a discount for going accident-free for three continuous years. On the other hand, Allstate offers a paperless discount, which is not available with State Farm.
In terms of customer experience, State Farm ranks highly in the J.D. Power Insurance Shopping Study and the J.D. Power 2023 U.S. Auto Claims Satisfaction Study. Allstate, although below average in the Insurance Shopping Study, ranks above the national average in the Auto Claims Satisfaction Study. It’s important to note that customer ratings on the Better Business Bureau (BBB) for both companies are generally low, which is common in the insurance industry.
Conclusion
In conclusion, when comparing Allstate and State Farm, it’s important to consider factors such as rates, coverages, discounts, and customer experience. While both companies have positive industry ratings and offer a wide range of coverage options, there are significant differences in terms of affordability. State Farm generally offers more affordable rates, making it a favorable choice for many drivers. However, it’s essential to evaluate your individual needs and preferences before making a final decision. By considering the information provided in this comprehensive comparison, you can make an informed choice and select the auto insurance provider that best suits your requirements.
Other Recommended Car Insurance Providers
In addition to Allstate and State Farm, there are other car insurance providers worth considering. These providers have been recognized for their competitive rates, coverage options, and customer satisfaction:
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Geico: Best for Budget-Conscious Drivers
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Geico is the second-largest auto insurer in the U.S., known for its low rates and a variety of discounts.
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Geico holds an A+ rating from the Better Business Bureau (BBB) and an A++ financial strength rating from AM Best.
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Travelers: Best for Most Drivers
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Travelers offers a wide range of coverage options and has an average cost of $1,595 per year for full-coverage car insurance policies.
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The company has been in business for over 150 years and holds an A++ financial strength rating from AM Best.
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By obtaining quotes from multiple providers, including Allstate, State Farm, Geico, and Travelers, you can compare rates and coverage options to find the best car insurance for your specific needs.