American Family Auto Insurance Review [New + Rates & Coverage]

If you are thinking of picking American Family as your provider, you need to first read this comprehensive review. The last thing you want to do is to hastily pick a provider who has hidden fees or poor coverage.

Getting into an accident with poor insurance can cost you significantly, which is why picking the right provider is so important.

That’s why we are going to go through everything you need to know about American Family, from its ratings to its rates. By the time you finish reading this review, you’ll be fully prepared to decide if American Family is the right choice for you.

Let’s get started. Want to start comparison shopping today? Enter your zip code in our FREE online tool above.

Rating Agency

Ratings are your first indication of if a company is suitable or not. To see how American Family fares, we are going to take a look at American Family’s ratings for everything from financial security to customer satisfaction.

Below is a list of American Family’s ratings at popular rating companies.

So what do all these ratings tell us about American Family? Let’s start with the financial ratings: AM Best and Moody’s.

An AM Best rating grades a company’s financial stability.  An A++ is the highest rating possible, so American Family’s A rating is lower than the top companies’ ratings but still means American Family has a stable financial future.

Moody’s ratings also measure the financial stability of companies by grading a company’s ability to pay off debts, also known as creditworthiness.

American Family’s last rating in 2007 was Aa3, which is fairly high and means the company had “a strong ability to repay short-term debt obligations.”

Let’s now take a look at the Better Business Bureau’s rating of American Family. The BBB looks at a company’s customer satisfaction standing, the most important factor in the rating being a company’s complaint history.

Since A+ is the highest rating BBB gives, BBB believes that American Family is better than most companies at serving customers.

JD Power also looks at customer satisfaction levels. American Family’s JD Power rating is okay, a solid three out of five, but it could be better.

Consumer Reports is another important company you should look at when researching customer satisfaction. Consumer Reports formulated American Family’s score of 89 based on the following ratings.

American Family’s scores from Consumer Reports are great, as excellent is the highest rating possible and very good is the second highest rating possible.

As for the Consumer Affairs’ rating of American Family, unfortunately, American Family auto insurance has a rating of two out of five stars.

This rating is based on only 290+ reviews, but over 180 reviewers gave American Family only one star.

Finally, the National Association of Insurance Commissioners (NAIC) looks at a company’s total complaints in comparison to the number of customers in order to formulate a complaint ratio. American Family’s complaint ratio is fairly normal, as it is just a little under one percent.

American Family, while it has solid financial ratings, definitely has some work to do on customer satisfaction.

Company History

Herman Wittwer founded Farmers Mutual Automobile Insurance Company in 1927, which eventually changed its name to American Family in 1963.

Since its birth, American Family has grown beyond auto insurance, offering sickness/accident insurance and homeowners insurance in the 50s.

Due to these expansions, American Family has become a brand name, amassing assets that have made it one of the top contenders in the insurance industry.

At this point, you may be wondering why we are throwing historical facts about American Family at you. Looking at an insurer’s history gives you a good idea of how much of the market share it has, as well as what awards and accolades its won.

This information tells us if a company will be successful in the future, especially because we also want to focus on American Family’s work environment.

So let’s jump right into American Family’s history.

– Market Share

A company’s market share shows if a company is competitive in the market. What makes a company competitive? Good rates, great customer service, and a stellar reputation.

With that in mind, let’s take a look at American Family’s market share data from the National Association of Insurance Commissioners (NAIC). Rather than looking at just American Family’s overall market share, we also included American Family’s market share in the auto insurance industry.

From 2015 to 2017, American Family’s market shares have increased slightly. This growth is a good thing, as it means American Family is doing something right to still be attracting customers 90 years after it was founded.

American Family also has a large percentage of the market in the auto insurance industry, which makes sense as American Family was started solely as a provider of auto insurance.

– Service Type

If you want to access information or get in touch with someone about your auto insurance policy, American Family has multiple contact options.

• Online — On American Family’s website, you can find information about policies, agents, and more.
• Agents — You can talk to agents by calling or emailing (as well as in-person).
• Apps — American Family offers a mobile app where you can access your policy information, roadside information, and more.

American Family’s contact methods are similar to other insurance companies; American Family offers phone, online, and in-person service.

– Commercials

Most insurance commercials depend on humor and catchy jingles or slogans to make the company stick in viewers’ minds. Behind the humor, though, is the company’s message of why they are the best insurer for you.

If a company doesn’t do a good job promoting its message and brand, sales will slow.

Let’s take a look at one of American Family’s commercials to see what message American Family is sending to its customers.

https://youtu.be/aIopp6NyrYY

American Family’s commercials claim one thing — that it is the best company to protect your future. Whatever unexpected accident may occur, American Family will step in to help protect you, so that you can keep having important life moments with those around you.

Later, we will look at American Family’s coverages and rates to see if the reality lives up to the commercials.

– Community Service

A company’s involvement in the community around it is important. A company that cares about people in the surrounding community will also care about customers.

Let’s take a look at American Family’s community involvement.

• American Family employees are encouraged to volunteer in their communities with paid volunteer hours.
• Agents are also encouraged to volunteer, and many have started local programs and fundraisers.
• The company also started Dreambank, a building where seminars, workshops, and educational sessions are provided for the local community.

Because American Family is a smaller company than insurers like Allstate, it doesn’t have as many programs as other bigger insurers. But American Family does care about its community, encouraging employees and agents to volunteer on a regular basis.

– How is American Family Positioned for the Future?

Since the last thing you want is to purchase a policy with a company only to have it go bankrupt in a year, we want to cobble everything we learned so far into answering one question — how is American Family positioned for the future?

While American Family’s financial future looks stable and it has rising market shares, it has less than stellar customer service reviews on rating sites like Consumer Affairs.

The good news is that American Family still has a good complaint ratio on the NAIC, and its other decent ratings on customer service sites help balance out Consumer Affairs’ negative rating.

Since American Family has good financial ratings, too, it should do well in the future as long as customer satisfaction ratings go up.

– Working at American Family

While we know not all customers are satisfied with American Family, we also want to take a look at what employees think of American Family. Employees who believe in American Family and enjoy working there make for a more enjoyable experience when purchasing a policy.

At Glassdoor, employees rated American Family 3.4 stars out of five. This rating was calculated from over 870 reviews.

Those who rated American Family poorly talked about the lack of benefits and opportunities, while 18 reviewers said there was a lack of work and life balance.

Good reviews talked about the great work environment and competitive pay. As well, 56 percent of the reviewers would recommend American Family to a friend, and 74 percent approved of the CEO.

Based on these reviews, most employees seem to have liked their time at American Family, though most wish it had been better. Payscale ratings confirm this, as the overall rating was 3.7 out of five stars.

Below, you can see Payscale’s overall rating of American Family broken down.

C0mpany outlook and manager relationship are the only categories that earned over four stars on Payscale. Other categories also received decent ratings, though, showing that American Family is a decent place to work at — neither the worst nor the best.

– Awards and Accolades

Let’s take a look at the most recent awards and accolades American Family has earned.

• 2017 Green Master Company — companies who practice sustainability for the environment
• 2017 Ranked 315 on the Fortune 500 list
• 2018 President’s Award from PGA TOUR Champions

These awards and accolades are a small number for a company that has been around for a while, but individual agents at American Family have received multiple awards and accolades for their work.

Bear in mind, too, that American Family is a smaller company and will have trouble competing with large insurers for awards.

Cheap Car Insurance Rates

We know cost is an important factor when you pick out a car insurance company. Though we’ve looked at American Family’s financial strength and customer service, we haven’t yet looked at what American Family costs.

Researching a company’s rates is important, as you could end up paying more (or less) than you expected.

To see what typical rates at American Family are, we are going to go through everything from its rates in Texas to how your driving record will change your rates at American Family.

– American Family Availability and Car Insurance Rates in Texas

American Family isn’t available in the following states.

• Alabama, Alaska, Arkansas, California, Connecticut, Delaware, District of Columbia, Florida, Hawaii, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Mississippi, Montana, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Tennessee, Vermont, Virginia, West Virginia, and Wyoming.

This means American Family only provides car insurance for about half of the U.S. states. If you move out of Texas, there is a good chance you won’t be able to keep American Family as a provider.

As well, the rates that American Family advertises will not be the same as the ones in Texas. Even within the same company, rates will vary based on the state you live in.

Why?

Because some states are riskier to ensure vehicles in than others. Crime rates and natural disasters are simply higher in some states. Since Texas is prone to a high number of natural disasters, American Family’s rates could be higher in Texas than its rates in other states.

Let’s take a look at American Family’s average cost of car insurance compared to the Texas state average.

American Family costs about $800 more than the average rate in Texas. While other companies are more expensive than American Family, such as Allstate, American Family is definitely not the cheapest provider of car insurance in Texas.

– American Family Compared to Top 10 Companies

We know that American Family costs more than the state average in Texas, but we also want to take a look at how American Family compares to other popular insurers’ prices.

American Family is the second most expensive provider in Texas. Only four providers are below the state average: GEICO, Nationwide, State Farm, and USAA.

American Family costs quite a bit more than other providers, especially those below the state average.

This means that unless people can qualify for discounts at American Family, its rates may take a large chunk out of most people’s budgets.

– Commute Rates

Let’s move on and look at how differences in commute distance can change rates at American Family.

Nope, that’s not a typo. American Family, unlike most providers, doesn’t charge customers more for a longer commute. This means that no matter how far you drive, you’ll still have the basic rate.

This is great for those with longer commutes.

– Coverage Level Rates

Does the quoted price for high coverage have you resignedly signing for medium or low coverage instead? If so, you aren’t alone.

Most people opt for medium or low coverage because these coverages are kinder on their wallets, but this decision could ultimately cost them more in the long run. Getting into an accident with poor coverage could result in you getting stuck with the bills yourself once your insurance maxes out.

Sometimes, though, high coverage is simply too expensive to even consider. That’s why we want to take a close look at American Family’s coverage costs.

The leap from low to high coverage at American Family is a little higher than at most companies, costing customers an extra $840 a year. While this adds up to about $70 extra a month, this amount can be too high when tacked onto other household costs.

Bottom line?

American Family has more expensive rates than most providers, and the increase between coverages shows that.

– Credit History Rates

Bad credit is a hard pit to crawl out of. Bad credit impacts multiple aspects of people’s lives, including their car insurance rates. In the state of Texas, insurers are allowed to look at people’s credit score history to determine rates.

In Texas, the average credit score is 656, which is below the average national credit score (675).

If a person’s credit score is below the average Texas resident’s credit score, it could result in higher rates. Let’s take a look at what American Family charges for different credit scores.

The decline from good to poor credit will cost American Family customers almost $3,000 more a year. This jump is higher than at other companies, where the normal range is one to two thousand extra for poor credit.

– Driving Record Rates

Finally, we want to take a look at driving record rates at American Family.

At American Family, an accident is more serious than a DUI or speeding violation and will cost customers over a thousand dollars in increased rates.

Remember that the table only shows costs for the FIRST offense. Continuous offenses will result in even higher rates than the ones shown above.

Coverages Offered

Now that we’ve covered basic rates, we want to dive into what coverages American Family offers. This way, you can decide if the rates you’ll pay are worth the coverage you’ll receive.

If a company has higher rates but offers excellent coverages, it may be worth purchasing over a company with cheaper rates but less offered coverages.

With this in mind, let’s look in-depth at American Family’s types of insurance, coverages, and discounts.

– Types Besides Car Insurance

American Family offers multiple types of insurance that go beyond just covering a car. Below are the two main insurance types American Family offers, along with a breakdown of what each can cover.

In addition to vehicle and property/business insurance, American Family also offers life and health insurance policies. If you bundle together policies at American Family, the company will give you a discount.

– Types of Car Insurance

Let’s take a look at the types of car insurance American Family offers. These coverages are important to have because Texas is an at-fault state, meaning if you caused the accident you’ll be stuck paying the other driver’s bills in addition to your own.

• Accidental Death or Dismemberment — Pays for deaths or dismemberments in an accident regardless of who caused the accident.
• Bodily Injury Liability — Injured someone else in an accident you caused? This coverage will pay their medical costs.
• Collision — This coverage pays for damages from collisions.
• Comprehensive — Pays for damages caused by a wide range of things other than a collision with another vehicle or object (animal collision, natural disasters, theft, etc.)
• Gap Coverage — Helps pay the difference between what you owe on your car and what its actually worth due to depreciation.
• Expense — With this coverage, it doesn’t matter who is at fault. Medical expense will cover the cost of your injuries and your passengers’ injuries.
• Mexico Auto Insurance — Gives you auto insurance coverage in Mexico if you are traveling.
• Personal Injury Protection — Helps cover your medical and lost income costs in an accident.
• Property Damage Liability — If you’ve damaged someone else’s property in an accident, this insurance will help pay for repairs.
• Rental Reimbursement — Covers the cost of a rental car while yours is in the shop.
• Umbrella Policy — Extra liability coverage.
•  Uninsured/Underinsured Motorist Protection — If the driver who caused the accident doesn’t have insurance or has poor coverage, these coverages will pay your bills.

In Texas, you are required to have bodily injury and property damage liability insurance. As well, you must have personal injury protection unless you officially reject it.

Clearly, American Family offers multiple coverages beyond Texas’s minimum requirements, meaning you can create a policy plan that keeps you well protected in multiple accident scenarios.

– Additional Coverages

American Family offers coverages beyond the ones we talked about earlier, as well as programs for American Family insurance customers.

• Commercial Car — Covers vehicles used for businesses.
• Dreams Restored Program — List of trusted repair shops that will give you priority status as an American Family policyholder.
• Emergency Road Service — Helps you with minor emergencies, such as flat tires and dead batteries.
• Ridesharing — If you want to drive for a company like Uber or Lyft, American Family offers ridesharing insurance.

These additional programs can give you great benefits and needed coverages to round out your car insurance policy.

– Discounts Offered

Discounts are vital in bringing your insurance costs down to a reasonable level. Below is a complete list of all the discounts American Family offers, as well as the percentages saved (when available).

American Family has a decent amount of discounts that it offers (the highest number of discounts out of all U.S. providers is 38, with most companies ranging between 20 to 30 discounts).

American Family’s driving app (Know Your Drive) is useful for all drivers. It monitors driving activity to encourage safe driving habits and rewards good drivers with discounts.

https://youtu.be/2-0wrSwbhdQ

Other discounts reward you simply for signing up for paperless billing, signing up for autopay, or having safety features on your car.

If you utilize as many discounts as possible, you could take a significant chunk off of your yearly costs.

– What Stands Out/What’s Missing

Let’s take a step back and look at what American Family has to offer, and what it’s missing so far.

• What Stands Out — American Family offers multiple coverages, more so than other insurers, such as insurers like State Farm. American Family also has a decent range of discounts to offer customers that can help cut back on costs.
• What’s Missing — American Family lacks military discounts, which is a common discount at most providers. There also isn’t a pay-as-you-drive program, where you pay less if you rarely use your car.

American Family has more standing out than what’s missing, as the company has a complete list of coverages and is lacking only a few discounts and programs that other insurers offer.

How to Make a Claim

Accident’s happen, and when they do (depending on the situation and who caused the accident), you’ll have to file a claim with your insurance company.

At some companies, this is easy. The bad news is that even though it may be simple to file a claim, this doesn’t mean your claim will be accepted.

This is why we want to look at the claim process at American Family, from its loss ratio to how easy it is to file a car insurance claim.

Stick with us, because we are going to see if American Family will be worth it in an accident.

– Premiums Written and Loss Ratio

Why should you care about American Family’s written premiums and loss ratios over the years?

• Written Premiums — Show if a company is growing and attracting new customers.
• Loss Ratios — Show if a company is financially strong. High loss ratios (over 100 percent) puts a company at risk of going bankrupt, whereas a low loss ratio means a company isn’t paying out claims.

A company could be writing out millions of dollars worth of premiums, but this doesn’t matter if a company isn’t paying out claims or is paying out so many claims it risks bankruptcy.

Your rates may also go up if a company is paying out numerous claims, as it needs more funds to pay off claims.

With this in mind, let’s take a look at American Family’s written premiums and loss ratios.

The numbers and percentages above are great. Not only has American Family increased its number of written premiums, but it has also increased its loss ratios to above 60 percent.

This number isn’t dangerously high at all, and it means that American Family has increased the number of claims its paying out. This is great news for you as a customer, as it means there is a higher likelihood of your claim being approved.

– Ease of Making a Claim

Accidents are stressful, which is why you don’t want to be with a company whose claim filing process makes the event even more stressful.

Luckily, filing a claim with American Family is fairly easy, and there are multiple ways you can file a claim.

• Online — You can file a claim online at American Family’s website. You will need to have your policy number, contact information, and accident/incident information.
• Mobile App — If you have American Family’s mobile app, you can use it to file a claim.
• Agent — You can also contact your agent directly to file a claim.
• Phone — You can call 1-800-MY AMFAM (1-800-692-6326) at any time (it is available 24/7, seven days a week).

Everything except contacting an agent can be done at any time, as you’ll have to contact your agent during working hours. This ease of convenience means that you can file in the middle of the night if needed.

How to Get a Quote Online

Just like filing claims, you want to make sure the process of getting a quote online is simple. A company that has a frustrating system to get a quote online probably also has a difficult claims process.

In this case, the simpler the better. Let’s take a look at how easy it is to get a quote online at American Family.

Naturally, the first thing you’ll need to do is visit American Family’s website. Right away, you will see an option to get a quote on the left side of your screen.

All you have to do is enter in your zip code and the type of insurance you want a quote for in order to get started. You will then be taken to a page that instructs you to click the get started button, which will redirect you to a quote page on American Family.

Once you click the get started button, you will be taken to an online quote form.

This form will request basic information, such as your name and address (prices vary by state and zip code, so this goes into factoring a rate quote).

You will also be asked to enter information about the following:

• Vehicle information (make, year, etc.)
• Driver information (ages, past accidents, etc.)

You will then be given additional information after your quote, as well as the option to purchase an American Family policy. As a reminder, here is what you’ll need to apply.

Getting a quote is simple, as all you need is basic information about where you live, your car, and driver history. You can also call an insurance agent directly to get a quote, but online is likely the easiest way.

Design of Website/App

It is easy to use American Family’s website. Clicking on any of the items at the top of the webpage, such as insurance or resources, will give you a dropdown menu with more information.

This makes it easy to find answers to common questions you may have, such as how to make a claim or how to download American Family’s apps.

You can also enter questions in the search bar at the top right of the page. If you already have an American Family account, you can also sign in at the top right.

As for American Family’s mobile apps, they have a general app that has 4.8 stars out of five from 28.5k ratings.

Some of the common complaints with the app are as follows.

• Doesn’t make timely payments on policy
• Trouble logging in (fingerprint ID doesn’t work, or page is forever loading)
• App is slow

Of course, apps constantly have bugs that need to be fixed, and since the majority of reviews are positive, it could be that American Family has worked out some of the app’s issues.

The app is convenient for doing to the following.

• Scheduling payments or setting up automatic payments
• Viewing policy/coverage details
• Saving proof of car insurance to device or wallet
• In-app payment reminders
• Contacting agents/searching for agent
• Finding an auto repair shop
• Filing a claim/viewing claim status
• Roadside assistance

American Family also has a KnowYourDrive app, which, unfortunately, isn’t nearly as good as the general app.

The app received 2.1 stars out of five from 69 ratings. Common complaints center around the app’s tracking and discounts.

Customers say the app doesn’t properly calculate slow driving and other driving habits, which in turn harms the point system.

Based on this, American Family clearly has a long way to go in improving their driving app to meet the standards of other insurers’ apps.

Pros and Cons

Now that we are near the end of this review, let’s take a look at the pros and cons of American Family.

Of course, more in-depth pros and cons will have to be factored by you, such as how expensive the rates are for your personal driving record, commute distance, and other important factors.

Getting a quote from American Family and comparing it to other providers will give you a better idea of if American Family is right for you. Of course, make sure to factor in the possible benefits of coverage levels and additional programs as well.

The Bottom Line

Let’s recap. American Family has some of the most expensive rates in Texas, but it is positioned well for the future based on its written premiums and loss ratios.

It may be harder to reduce rates through American Family’s safe driving app, though, due to problems with the app itself. While other discounts are also available, such as the bundling discount, it may be harder to make up the percentage saved through the faulty app.

Customers are also dissatisfied with American Family on Consumer Affairs’ rating, though other customer satisfaction rating sites gave American Family decent ratings.

As long as American Family works on its apps and customer satisfaction, it may be an option for you. Of course, you will have to take advantage of discounts to save at American Family, especially since American Family is more expensive.

FAQs

If you still have some questions that need to be answered about American Family, don’t fear. We are going to end this review by going through some commonly asked questions people have about American Family.

What is American Family’s grace period? If you miss a payment at American Family, you’ll have a grace period of 10-14 days to make the payment. During this time, your policy will lapse and will only be reinstated when you make the payment.

What if I’m not satisfied with my claim settlement? American Family doesn’t have a claims satisfaction guarantee (where you can file if you’re dissatisfied with your claim within a certain time), but you can contact an agent to talk further about your claim settlement and its issues.

What is American Family pay-by-phone? If you are having issues with automatic payment on the app or online (or simply want to pay with a different method), you can call 1-866-424-8002 to pay by phone at American Family.

Will American Family replace or repair my windshield? American Family has an Auto Glass Safelite Insurance Repair program. Depending on what type of coverage you have (you’ll usually need comprehensive coverage), the Safelite program will repair or replace your windshield and sometimes will even drive to you to replace it.

What does emergency roadside assistance cover? American Family will help you with the following situations: towing, flat tires, jump starts, out of gas, and keys locked in the car.

Hopefully, we’ve answered some of the questions you have about American Family (you can always visit the website to search a more specific question).

Now that you’ve read our review on American Family, though, you have all the tools you need to decide if American Family is the right provider for you.

Enter your zip code in our FREE online tool below to start comparison shopping in your area today.