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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Laura Walker graduated college with a BS in Criminal Justice with a minor in Political Science. She married her husband and began working in the family insurance business in 2005. She became a licensed agent and wrote P&C business focusing on personal lines insurance. Laura serviced existing business and wrote new business. She now uses her insurance background to help educate drivers about...

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Reviewed by Laura Walker
Licensed Agent for 10 Years

UPDATED: Apr 1, 2019

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As two of the nation’s largest auto insurance companies, State Farm and Nationwide together account for one-quarter of the entire market share in automobile insurance. Their large size makes them stable, and their ability to pay claims draws customers looking for an established insurance company.

If you compare these two giants of the industry, are there really any differences between them? Is one big company just as good as another?

Use our FREE quote tool to compare insurance rates today!

State Farm Insurance

State Farm began in 1922 as a farm vehicle insurance agency in Illinois. Typically, no insurance companies existed which were willing to insure tractors and attachments, so the new company quickly grew, expanding into automobile insurance a few years later. Today, State Farm is the largest personal insurer in the country, with over 80,000 employees.

There are State Farm insurance agents in offices in almost every good-sized city in the United States. State Farm’s sweeping presence has helped to ensure that it remains a huge insurance force.

Read a State Farm Auto Insurance Review

Nationwide Insurance

Nationwide is not just insurance. It also incorporates separate companies that deal with financial investments and money management. In fact, Nationwide is not a “company,” per se, but a conglomeration of several different companies working together under the Nationwide banner.

Nationwide was formed in 1926 as a farmholder’s insurance company for automobiles.

Like its rival, State Farm, Nationwide, operating as Farm Bureau Mutual, saw the need in the rural areas for reliable insurance. As the company grew, fire, theft, and life insurance were added. Today, it operates coast-to-coast and serves one of the largest customer bases in the industry.

Read a Nationwide Auto Insurance Review

Customer Ratings for Nationwide and State Farm

While both companies serve a large customer base, the J.D. Power and Associate’s annual review of 2011 shows that State Farm far outperforms Nationwide in customer satisfaction. State farm scored three out of five on three of the categories assessed by the survey, but had an overall satisfaction rating of four out of five, translating to “better than average.”

Nationwide, on the other hand, could not gain three out of five on most of its categories, ending up with an overall two out of five rating, which is “below average.” The survey measures customer satisfaction in the area of policy offerings, pricing, billing, and interaction with employees.

J.D. Power also compiles a customer satisfaction index, based on a scale of 1000. State Farm ranked 6th overall in the nation on this scale, with a score of 804, well above the industry average of 790. Nationwide, on the other hand, scored a 767, placing it 22nd among the companies listed.

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Who has cheaper auto insurance rates – Nationwide or State Farm?

Auto insurance rates vary greatly from one state to another, and from one driver to another. Comparing rates is sometimes misleading, because different companies may not have the representation in one area that they do in another, making their rates higher only for that location.

However, a general comparison of State Farm’s rates and Nationwide’s shows that, on average, the two are similar.

In California, State Farm’s rates are slightly higher overall than Nationwide’s, except in the grouping of married couples. A young single male in California will pay $2,156 for State Farm coverage, but only $1,647 for Nationwide. However, a married couple will pay $2,071 for Nationwide and only $1,330 for State Farm.

On an overall average, the two companies are nearly tied with State Farm at $1,684 and Nationwide at $1,697.

In New York, Nationwide averages much higher in all categories than State Farm, with young males paying $4,406 for coverage with Nationwide and only $3,178 for State Farm. Older females paid $2,156 for Nationwide and $1,540 for State Farm.

As you can see, location makes a big difference when figuring auto insurance rates. It is important to get quotes from the companies you are considering before making a decision. The quote will take into account your location, age, and driving record, as well as the type of car you are insuring.

Which auto insurance company is better – State Farm or Nationwide?

While both auto insurance companies are large providers in the United States, each has their own advantages and disadvantages. State Farm does not rely as heavily on internet and telephone servicing as Nationwide, with more “field agents” in place, so if personal service is important to you, that should be considered.

On the other hand, Nationwide has many subsidiaries and financial groups to help you manage your entire portfolio of investments and insurance, and this can be useful if you want to deal with only one company.

Choosing an auto insurance company should not be based solely on ratings, but on your interactions with the agent and company, and your own feelings about the treatment you receive.

Start an auto insurance comparison search today and compare auto insurance companies online.

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