State Farm vs. Liberty Mutual Auto Insurance
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UPDATED: Apr 12, 2020
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When it comes to auto insurance, both State Farm and Liberty Mutual are decent choices. Liberty Mutual has been around since the year 1912 and State Farm has been selling auto insurance since 1942.
State Farm is the biggest provider of auto insurance, although Liberty Mutual is the 4th largest.
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When it comes to choosing an insurance provider for your car, there are many factors that can go into your decision. Price is an important factor for many drivers but there are other things you should look at as well.
Determine what is important to you–whether it is customer service, the claims process, or cost of the premium–and then do some research to see which company will serve your needs the best.
State Farm Consumer Ratings
One of the best ways to judge a car insurance provider is to see what other customers have to say about it. J.D. Power publishes results of customer surveys that rate different aspects of insurance companies.
Because not all insurance companies sell insurance products in all states, customer satisfaction ratings are listed according to region.
For satisfaction overall, State Farm got four out of five stars in California and the Central region, it received three stars in the Mid-Atlantic region and Northeast region, and it received the highest rating of five in the North Central, Southeast, and Western regions.
Liberty Mutual Consumer Ratings
The ratings from J.D. Power for Liberty Mutual are generally lower than State Farm’s. Liberty Mutual received three stars for overall satisfaction in California, North Central, and the Northeast, and it received two stars in the Central, Mid-Atlantic, Southeast, and West regions.
Both State Farm and Liberty Mutual offer similar things when it comes to basic coverage types, such as liability, collision, comprehensive, uninsured motorist, and medical coverage. Each company offers some different coverage, however.
State Farm offers coverage for car rental if your vehicle is ever in the shop. It also covers some travel expenses that are related to an accident that is covered by your policy.
State Farm also offers emergency road service. This helps to pay for towing costs, a flat tire, a jumpstart, or a locksmith.
Liberty Mutual offers optional coverage called better car replacement. With this coverage, if your vehicle is ever totaled, you will get money for a replacement car that is a newer year and has fewer miles than your old car.
Liberty Mutual also offers car rental coverage but, as opposed to State Farm, which has daily limits on the rental, Liberty offers unlimited coverage. Liberty Mutual offers replacement for mechanical parts when your vehicle is repaired at a shop that is approved by Liberty.
It doesn’t make a difference how old the parts are.
Liberty Mutual also has coverage for windshields. This is offered under either your comprehensive policy or an optional glass coverage policy. If your windshield is damaged, you can have it fixed at a location that is convenient for you, whether it is at work or at home.
When it comes to comparing the premium prices of State Farm and Liberty Mutual, they are fairly similar, although it depends on the state in which you live. It is difficult to predict what you would be paying for, as car insurance rates vary drastically not only from company to company, but for each individual driver as well.
The Insurance Information Institute says that the average annual premium for car insurance across the country is $850. This will be higher or lower based off of the information that you give.
State Farm uses seven main factors to figure your rate: coverage types and deductibles; the kind of vehicle you drive; how much and how often you drive; where you drive; your driving history; your gender, age, and marital status; and your credit score.
For Liberty Mutual, the most important factors when it comes to your rate are the type of vehicle you drive, where you live and store your car, and your driving record.
When it comes to a rate quote, some of the factors you can control, like your driving record and credit, and others, such as your age and gender, are not as much in your control.
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State Farm Auto Discounts
Discounts are one way that insurance companies help keep your policy premium low. Discounts apply to things that help keep your risk low. Your insurance agent will help you figure out if you are eligible for any of the discounts that are available.
State Farm offers a variety of discounts. One is a good student discount. Teenage drivers get into wrecks four times more than other drivers, according to the Centers for Disease Control and Prevention. Because of this, rates for drivers under the age of 20 are very high.
Statistics show that students who are responsible in school and get good grades are more responsible on the road. The good student discount can save you up to 25% on your premium. With State Farm, the discount lasts through college and even past college, up to the age of 25.
State Farm offers discounts for both multiple automobiles and multiple lines of insurance. If you insure two or more vehicles under the same policy, you can save almost 20%. If you have life, condo, renter’s, or homeowner’s insurance, and purchase them with State Farm as well, you can save 17%.
State Farm rewards good drivers with a discount.
This is for drivers who go three or more years with no caused accidents and no moving violations. For drivers ages 25 or younger, State Farm offers a Steer Clear course. When young drivers have completed this and have no violations or accidents for three years, they can save 15%.
Other discounts for safe driving include one for taking a specific defensive driving course and the Drive Safe & Save program. With this program, you will save more when you drive less and drive your vehicle safely. For this you need to have an eligible vehicle and be open to sharing certain information about your driving.
Liberty Mutual Auto Discounts
To help save you money, Liberty Mutual offers discounts as well. As with State Farm, Liberty Mutual offers discounts for multi-policy and multi-car. It also has a good student discount for teenagers, which is considered to be a “B” average or better.
Unlike State Farm, Liberty Mutual offers savings for employees and members of certain alumni associations, credit unions, groups, and employers. Ask your agent about its affinity program and whether you are eligible for any of the savings.
Liberty Mutual offers discounts for certain vehicle features. If you have seatbelts and at least one airbag, you get a passive restraint discount.
Vehicles that have anti-lock brakes and devices to help prevent theft will save you money.
Drivers who drive fewer miles in a year can also save money with Liberty Mutual. The low mileage discount applies for those who drive 7,500 miles or less per year.
If you are in the market for a new car, you can visit Safer Car to find one with high safety ratings. This will help you not only be eligible for the discounts, but also save money on your policy from the start.
One of the things you want to look at when comparing car insurance companies is how they stand financially. You want to choose a company with a strong financial rating and a good outlook for the future. This is a fairly good indicator that your current and future claims will be covered by your insurance policy.
There are a number of companies that independently rate insurance companies. A.M. Best and Standard and Poor’s are two of them. They look at the assets that each company has, as well as other factors, to come up with their results.
A.M. Best has given State Farm a financial strength rating of “A+”, which is a superior rating.
The issuer credit rating is “aa-”. The outlook for both financial strength and issuer credit is stable, which indicates that the chance of the rating changing in the near future is low.
The financial strength rating for Liberty Mutual is “A”, which is considered to be excellent. The issuer credit rating is an “a”. The outlook for financial strength as well as issuer credit is stable.
Although State Farm received higher ratings than Liberty Mutual did, they still both scored well. The fact that both companies have been around for many years is a great sign as well. It shows that they have been able to survive through all the economic changes over the years.
You should really only be concerned if a company has a rating of “B” or lower; as this indicates that the company is financially vulnerable.
Both State Farm and Liberty Mutual are stable auto insurance companies that rate high financially. Choose the one that fits your needs best or choose one that has been recommended by someone you trust.
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