Review of American Family Insurance

According to the National Association of Insurance Commissioners (NAIC), American Family Insurance is the tenth-largest auto insurer in the United States. In 2007, the company wrote $3,559,758 of direct, private-passenger auto insurance premiums. American Family’s market share is estimated at about 2.2% of the car insurance market. Although it is not one of the largest insurers, American Family remains a contender because of its dedication to customer service and quality. Read on for an overview of American Family auto insurance and how it stacks up against the competition.

History

American Family got its start on October 3, 1927 when Herman Wittwer, an insurance salesman, began Farmers Mutual Insurance Company in Madison, WI. Wittwer chose the name because the company only offered auto insurance, and it primarily targeted farmers. American Family’s founder believed that farmers were less of a risk to insure because they drove less frequently than city drivers. Eventually, Farmers Mutual began offering more insurance products and changed its name to American Family Mutual Insurance Company in 1963 to more accurately reflect its larger policyholder base.

Customer Satisfaction

American Family Insurance is particularly well-known for the customer service provided by their agents. One of the areas in which American Family excels is the ease with which car insurance policyholders can get in touch with the company, whether through a representative or an agent. Although American Family usually performs well in auto insurance customer satisfaction surveys, it did not fare well in the 2008 J.D. Power and Associates study. Here is how American Family performed on various measures of policyholder satisfaction:

Financial Strength

A car insurance policy is worthless unless the company that issues it has a solid financial foundation. Since its beginning, American Family Insurance has consistently demonstrated financial stability. Because American Family is a mutual company, the policyholders are the owners. This allows the insurer to focus more closely on results in the long run. Currently, American Family has about $15.5 billion of assets under management and $4.1 billion of policyholder equity. American Family is also regularly rated positively in financial indexes like A.M. Best and Standard and Poor’s.

Growth

In the beginning, American Family offered only car insurance policies. Today, the company offers a variety of insurance coverage and financial products in 19 states. Moreover, American Family is the third-largest mutual casualty and property insurer in the United States. American Family consists of a number of companies, including American Family Life Insurance and American Family Financial Services.

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