USAA Auto Insurance — Providing Outstanding Coverage and Service to Military Families
For almost a hundred years, USAA has focused solely on insurance and financial products for current military members and veterans. With options tailored to those who are serving, or have formerly served, USAA has grown to become one of the largest — and most trusted — providers of auto insurance. There are multiple benefits to a USAA auto insurance policy, and if you’re eligible, you owe it to yourself to look closer at what USAA provides.
What is USAA?
USAA, which stands for United Services Automobile Association, was founded by a group of Army officers who wanted to self-insure. These 25 officers pooled together their resources to provide adequate automobile coverage for one another. As the company grew, coverage and services were then extended to all branches of the military.
Fast forward 100 years later and USAA now provides a vast array of insurance and financial products to over 13 million members. Products range from insurance for auto, homeowners, and renters, to banking options, retirement, and investment products. USAA also offers mortgages and dental and vision insurance.
According to USAA, the mission of this provider is “To facilitate the financial security of its members, associates and their families through provision of a full range of highly competitive financial products and services; in so doing. USAA seeks to be the provider of choice for the military community.”
Now headquartered in San Antonio, Texas, with 35,000 employees and seven offices throughout the country, USAA has grown to become one of the largest insurance providers focused exclusively on the needs of service members.
How does USAA work?
USAA offers coverage to active duty and former military and their spouses, widows, and widowers. You can even join if you are an un-remarried former spouse of a USAA member (as long as the member joined during your marriage). USAA considers former military members for membership as long as there was an honorable discharge. As a bonus, children of USAA members can also join.
USAA is available for service members of all military branches, including the U.S. Air Force, Army, Coast Guard, Marines, Navy, National Guard, and Reserves.
USAA offers memberships and considers anyone affiliated with its company a “member.”
USAA membership is free, as long as you meet the eligibility criteria.
USAA members and non-members can go online to obtain insurance quotes, or call the customer service number. Once your eligibility is confirmed, the quote process is straightforward.
USAA auto insurance offers the standard insurance policy options you’d expect, including:
- Collision coverage
- Comprehensive coverage
- Bodily injury and property damage liability coverage
- Medical payments
- Personal injury protection (PIP)
- Uninsured and underinsured motorist
But USAA offers several additional coverage options and benefits, including accident forgiveness, car rental reimbursement, and roadside assistance.
How much does USAA cost?
Like other carriers, the cost of insurance premiums with USAA is based on a variety of personal factors, including:
- Age
- Gender
- Marital status
- Location
- Driving record
- Credit score
- Vehicle type
- Amount of deductible
- Insurance coverage and add-on options
Getting a quote directly from USAA, either online or on the phone, is the best way to determine the cost of your insurance premiums.
One quote obtained for drivers in their thirties showed an annual premium average of $963 with USAA. According to the USAA website, members save an average of $707 on yearly auto premiums by switching to a USAA policy.
Examples of premium costs
For a real quote example, I got a quote based on a single, college-educated male renting a home in Chicago driving an average of 11,000 to 13,000 miles a year in a 2018 Toyota Camry as of March 28, 2021. I received the minimum and full-coverage options.
Minimum coverage includes:
- Bodily Injury: $25k/$50k
- Property Damage: $20k
- Uninsured Motorist Bodily Injury: $25k/$50k
Full coverage includes:
- Bodily Injury: $100k/$300k
- Property Damage: $50k
- Uninsured Motorist Bodily Injury: $100k/$300k
- Collision Deductible: $1k
- Comprehensive Deductible: $1k
| Type | 25-year-old | 35-year-old |
|---|---|---|
| Minimum coverage | $1,086 | $890 |
| Full coverage | $2,160 | $1,554 |
Ways to lower your premiums
If you’ve exhausted all the discounts available with USAA but you find your insurance premiums are still too much, take advantage of the following:
- Raise your deductible: Your deductible is the amount you pay out of pocket before your insurance kicks in. If you have a low deductible, such as $250 or $500, your rates are higher. Consider raising your deductible to $1,000, which can save you an additional 15 to 30%, according to the Insurance Information Institute.
- Improve your credit score: Although not a short-term solution, the higher your credit score, the lower your rates. As you work on improving your credit, make sure this is factored into your insurance premiums.
Features of the USAA auto insurance policy
Where USAA begins to separate itself from other carriers is the number of features an auto policy offers, plus the outstanding ratings and reviews. Let’s look at the features first.
Specialty features
In addition to the standard coverage options, policyholders have access to several benefits, including:
- Roadside Assistance: If you're stranded, this option gets you back on the road or provides towing of your vehicle. Also includes services to unlock your car, deliver gas, or change a tire.
- Car rental reimbursement: Pays for a rental car (up to the class you choose) while your vehicle is being repaired if it’s in the shop for a covered insurance claim.
- Accident Forgiveness: This optional coverage is offered for free after five years if you or your household hasn't had an at-fault accident.
- Car Replacement Assistance: If your vehicle is declared a total loss then this benefit would include an additional 20% of the actual cash value of the vehicle from the settlement of your claim.
- Guaranteed renewal: Once a member of USAA, you’ll remain a member for life as long as you pay your premiums.
- Rideshare coverage: USAA provides this additional coverage for your existing USAA policy if you drive for a company such as Uber or Lyft.
Range of discounts available
In addition to competitive rates, USAA offers multiple discounts to further reduce insurance rates. Discounts include:
- Bundling
- Driver training
- Defensive driving course
- Good student
- New vehicle
- Annual Mileage
- Multi-vehicle
- Vehicle storage
- Family
- Loyalty
- Military installation
- Plus car rental and travel discounts for members
Access to digital assets
USAA offers a highly-rated mobile app for full access to your auto policy. From there, you can submit claims, update your policy, access your documents, plus access all of your USAA products. Currently, the app has a 4.8 out of 5-star rating with over a million reviews.
Online help is a click away too, with access to customer service, policies, quotes, and the claims center.
Outstanding customer service support
One of the hallmarks of USAA is its comprehensive customer service and support. This isn’t only based on personal stories but backed up with ratings too. For instance, the JD Power 2019 U.S. Auto Claims Satisfaction Survey shows USAA earns the highest number of points with a 900-point rating for overall satisfaction. USAA also earns an A- rating with the BBB.
The NAIC Consumer Complaint Index shows USAA comes in with a .68 rating, which is well below the industry average of 1.0. This index measures the number of official complaints filed against a carrier.
Who is USAA for?
USAA offers such a wide range of benefits and perks geared towards service members and veterans, that anyone eligible should add USAA to their shortlist for quotes. If strong customer service and competitive rates are important to you, then you would likely be impressed with what USAA has to offer.
Who shouldn’t use USAA?
If you prefer working one-on-one with a local insurance agent, then USAA may disappoint. To manage your policy or file a claim, working through the mobile app or website is the preferred method, or you can call the customer service number.
And if you or your immediate family are not affiliated with the military then you won’t have access to the benefits of a USAA policy.
Pros and cons
Pros
- Financial strength. All the benefits and options listed for USAA members wouldn’t be possible without strong financial backing. Fortunately, USAA has the strength and stability to serve its members well. USAA receives a Superior A++ financial rating from the AM Best company. In addition to the Exceptional Aaa from Moody's Investors Service and Very Strong AA+ from Standard & Poor's rating.
- Understands the unique needs of current and former servicemembers. Since USAA was founded by service members, the company understands the individual needs of each military family. For instance, there are reduced rates if you or a family member is deployed and your car will be parked for several months. USAA also offers financial assistance and transitioning services as your military career takes you down new paths.
- Digital assets. USAA offers multiple options for convenience, from the 24/7 customer service line, to the full-service website and mobile app. All three options allow you to make changes to your policy, file a claim, and general policy management.
Cons
- Requirements. Unless you meet the criteria mentioned above, you won’t be eligible for an auto policy with USAA.
- No live agent or local agent network or local branches. If you need to discuss any policy-related issues or quotes, you have to work online, through the app, or call the general customer service number.
USAA vs. competitors
| Carrier | JD Power Score | AM Best Financial Rating | Discounts offered | Average annual premiums |
|---|---|---|---|---|
| USAA | 5/5 | A++ | Yes | $963 |
| Erie | 3/5 | A+ | Yes | $1,108 |
| Geico | 3/5 | A++ | Yes | $1,218 |
| State Farm | 3/5 | A++ | Yes | $1,585 |
| Nationwide | 3/5 | A+ | Yes | $1,582 |
| Amica Mutual | 5/5 | A+ | Yes | $1,631 |
| Progressive | 3/5 | A+ | Yes | $1,646 |
| Allstate | 3/5 | A+ | Yes | $1,920 |
| Liberty Mutual | 3/5 | A | Yes | $1,942 |
| Farmers | 3/5 | B++ | Yes | $2,020 |
Full reviews on competing insurance companies can be found in links.
The bottom line
It’s hard to argue with the strength of a company like USAA. As you’re shopping around for your auto insurance coverage options, if you’re eligible, make sure you include USAA in your list of companies to review.
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