Aaa Vs Usaa: Unlocking The Auto Insurance Advantage

AAA and USAA are two of the most popular options for car insurance in the United States, but which is best?

USAA is a large, nationwide insurance provider that has been in operation for many years, but its focus is on serving the United States military personnel, both active and retired. AAA, on the other hand, is a membership-based company that offers insurance coverage to its members via its local auto clubs.

USAA typically offers more competitive rates across various driver profiles and is especially geared towards military members and their families, providing unique discounts and benefits tailored to their needs. AAA, meanwhile, has an overall higher consumer satisfaction score, possibly due to its roadside assistance program.

So, which is better? It depends on your specific needs and eligibility. If you're a military member or part of a military family, USAA is likely the best option due to its low rates and specialised services. If you're a civilian, AAA may be preferable thanks to its additional membership benefits and broader eligibility requirements.

Customer satisfaction

AAA and USAA are two of the most popular insurance companies in the United States, but they cater to different audiences. AAA is known for its roadside assistance programs and auto insurance provided through partner companies, while USAA is exclusive to military members, veterans, and their families. Both companies have their own unique features and benefits, so it's important to understand how they compare in terms of customer satisfaction.

USAA has consistently received high ratings and reviews from its customers, especially those with a military background. It has been praised for its competitive rates, wide range of coverage options, and efficient claims handling process. USAA also offers a variety of discounts tailored specifically for military personnel, such as discounts for garaging a vehicle on base or storing a vehicle during deployment. In the 2023 J.D. Power U.S. Auto Claims Satisfaction Study, USAA scored 900 out of 1,000 points, demonstrating its strong performance in this area.

On the other hand, AAA's customer satisfaction scores are generally lower. Its insurance services are provided through various regional clubs, and the ratings for these clubs vary. For example, Auto Club of Southern California received a high score of 889/1,000 in the J.D. Power Study, while CSAA and Automobile Club Group scored below the industry average at 874 and 848, respectively. AAA also has a lower rating from the National Association of Insurance Commissioners (NAIC) Complaint Index, indicating that it receives more customer complaints relative to its size compared to USAA.

When it comes to mobile apps, both USAA and AAA offer highly-rated apps that provide convenient access to insurance information and claims handling. USAA's app also includes banking and investment services, while AAA's app provides access to a range of membership benefits, such as travel planning tools and approved restaurants and hotels.

Overall, USAA has a strong reputation for customer satisfaction, especially among military members and their families. AAA's customer satisfaction scores are more mixed, with some regional clubs performing better than others.

Roadside assistance

When it comes to roadside assistance, both USAA and AAA have a lot to offer. However, there are some key differences between the two.

USAA offers roadside assistance services to its policyholders, including stuck vehicle assistance. This service is also available at reduced rates to policyholders who don't have roadside assistance on their policy. USAA is known for its focus on serving military members, veterans, and their families, and this eligibility requirement sets it apart from other insurance providers.

On the other hand, AAA is perhaps even more closely associated with roadside assistance. The company has been providing this service for over 100 years and has a fleet of more than 63,000 towing and roadside service trucks across the country. AAA offers different levels of membership for roadside assistance, with higher tiers offering reimbursement for larger amounts or longer-distance towing. The highest tier even includes trip interruption coverage. AAA's roadside assistance is available to members in any car, whether as a driver or passenger, and in the US or Canada.

In terms of cost, USAA's average rates are generally lower than AAA's. USAA's average monthly rate for liability coverage is $46, while AAA's is $86. However, it's important to note that AAA also offers membership perks like travel discounts, which could be valuable for frequent travellers.

Both companies have their strengths in roadside assistance, but ultimately, the best choice depends on individual needs and eligibility. USAA's restricted membership makes it more exclusive, while AAA's broader membership and additional perks may appeal to those seeking a more comprehensive package.

Insurance rates

When it comes to credit scores, USAA is preferable for those with very poor credit (below 580). For drivers with exceptional credit (above 800), USAA typically offers savings of up to $1,974 annually compared to AAA.

USAA also tends to have better rates for high-risk drivers. If you have an at-fault accident, speeding violation, reckless driving violation, or a DUI on your record, USAA is likely to offer more competitive rates.

Age is another factor influencing insurance rates. USAA is generally more affordable for older drivers, with average yearly savings of $7,392 for teen drivers compared to AAA.

It's worth noting that USAA has stricter eligibility requirements, as it caters specifically to military members, veterans, and their families. In contrast, AAA has broader membership eligibility, although it does require an annual membership fee.

Both companies offer various discounts to reduce insurance costs. USAA has discounts for bundling, insuring multiple vehicles, living on a military base, and more. AAA provides discounts for safe driving, student status, and garage parking, among others.

In summary, USAA typically offers more competitive rates across different driver profiles, especially for those with military connections. However, AAA's rates may be more favourable for older drivers with good credit and a clean driving record. When comparing insurance rates, it's important to consider individual needs, eligibility, and the value placed on additional membership benefits offered by AAA.

Credit score impact

Credit scores can have a significant impact on auto insurance rates, with higher credit scores generally leading to lower insurance premiums. This is because insurance companies believe that drivers with poor credit scores are more likely to file insurance claims, making them more expensive to cover.

In most states, insurance companies use credit scores as a factor in determining insurance rates, but this varies by state and company. For example, USAA offers better rates than AAA for drivers with credit scores lower than 580, while drivers with exceptional credit scores of 800 or higher should consider USAA, which is, on average, $1,974 cheaper annually than AAA.

It's worth noting that insurance companies don't use the same credit scores as lenders, and they also consider other factors when setting rates, such as driving history, location, age, and vehicle type. Additionally, getting an insurance quote won't hurt your credit score, as insurance companies typically perform a "soft pull" on your credit report, which doesn't impact your score.

Discounts

USAA offers 14 auto insurance discounts, including:

• Safe driver discount: For maintaining a good driving record for more than five years.
• Defensive driving: For taking an approved defensive driving course.
• Driver training: For taking a driver's education or driver training course.
• Good student discount: For students aged 16-25 who are enrolled full-time in high school or college and maintain at least a "B" average.
• SafePilot discount: Save up to 30% by allowing USAA to track your driving habits, including speed, acceleration, and braking.
• New vehicle discount: For insuring a brand-new car.
• Multi-vehicle discount: For insuring more than one car on the same policy.
• Annual mileage discount: For driving less than 12,000 miles per year.
• Vehicle storage discount: For storing your car.
• Family discount: For being previously listed as a named driver on a family member's USAA policy.
• Length of membership discount: For being a long-time customer.
• Military installation discount: For storing your car on a military base.
• No payment plan fees discount: For paying your premium upfront.
• Multi-policy discount: For buying multiple types of insurance from USAA.

AAA also offers a variety of discounts, although the specific discounts available may depend on your location. Some of the discounts offered by AAA include:

• Home and auto bundle: Save by bundling auto and home insurance policies.
• Good student discount: For students who maintain a high academic standard.
• Multi-vehicle discount: For insuring more than one vehicle under the same policy.
• Vehicle storage: For deployed policyholders or those storing their vehicles long-term.
• Garaging a vehicle on base: For policyholders who live and garage their vehicle on a military base.
• New car: For cars less than three years old.
• AAA membership: Drivers could save up to 10% on their auto policy due to their AAA membership.
• Professional/association: Policyholders within certain professions or educational associations may receive a discount.
• Loyalty: Drivers who maintain AAA auto insurance for more than a year may be eligible for a loyalty discount.

Both USAA and AAA also offer telematics programs that track your driving habits and provide feedback and potential discounts. USAA's SafePilot program offers a 10% discount for signing up, with up to 30% savings for safe drivers at policy renewal. AAA's telematics program, AAADrive, offers a 5% discount for signing up, with up to 10% for enrolling all family members and up to 25% at renewal based on your driving score.

Frequently asked questions