Direct Auto Insurance: Legit Or Scam?

Direct Auto Insurance is a real company that specializes in high-risk drivers. It offers auto insurance in 14 to 18 states, including Alabama, Arkansas, Florida, Georgia, Louisiana, Michigan, Mississippi, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Virginia and Washington. Direct Auto is part of the Direct General Group and was acquired by National General in 2016, which was then purchased by Allstate in 2021. The company has received poor reviews for its customer service and has a high number of complaints, particularly regarding claim delays and denials. However, it offers a range of discounts and flexible payment options for customers.

Direct Auto Insurance's high volume of customer complaints

Direct Auto Insurance has received a high volume of customer complaints, with a large number of negative reviews online. The company has an average rating of 4 out of 5 stars on WalletHub, but its NAIC rating is 10.92, indicating a higher-than-average number of customer complaints relative to its size. Similarly, Direct Auto has received six times the number of complaints compared to an average company of its size, according to data from the National Association of Insurance Commissioners (NAIC).

Many of the complaints focus on issues with customer service, delayed or denied claims, unexpected premium increases, and difficulties with policy adjustments and cancellations. For example, one customer reported being hung up on multiple times when trying to report a hit-and-run accident, while another complained about unexpected premium increases and a lack of transparency regarding their policy. There are also complaints about the company's roadside assistance service, with some customers reporting long wait times and issues with reimbursement for towing services.

In addition to the volume of complaints, Direct Auto Insurance has also been criticised for its poor customer service. Some customers have reported difficulties in reaching the company by phone, experiencing long hold times, and receiving rude or unhelpful responses from customer service representatives. These issues have led to a high level of dissatisfaction among customers, with some choosing to switch to other insurance providers.

While Direct Auto Insurance may be a viable option for high-risk drivers in need of basic coverage, the high volume of customer complaints suggests that there may be better alternatives available in the market.

Direct Auto's coverage options

Direct Auto Insurance offers a range of coverage options for drivers, including standard types of car insurance and additional services.

Standard Coverage Options

Direct Auto offers the following standard types of car insurance:

• Liability car insurance: This covers property damage and medical expenses for others when the policyholder is at fault for an accident. It also covers court judgments, settlements, and lawyer fees.
• Uninsured and underinsured motorist coverage: This covers medical expenses for the policyholder and their passengers if they are in an accident with an at-fault driver who doesn't have liability insurance or has insufficient coverage. In some states, "property damage uninsured motorist coverage" is also available, reimbursing repairs if an uninsured driver damages the policyholder's vehicle.
• Personal Injury Protection (PIP): PIP covers medical, hospital, and funeral expenses associated with an auto accident, regardless of who is at fault. It also covers lost wages and replacement services for tasks the policyholder cannot perform due to their injuries, such as childcare.
• Medical Payments (MedPay) Coverage: MedPay covers medical expenses related to a car crash, regardless of who is at fault. It typically has lower limits and doesn't include benefits like lost wage payments, which are included in PIP.
• Collision and comprehensive insurance: Collision insurance covers repairs or replacement of the policyholder's vehicle when it is damaged or destroyed in an accident. Comprehensive insurance covers non-crash damage, such as hitting an animal, fire, theft, vandalism, and severe weather damage. These coverages are often sold together and may be required by lenders for leased or financed vehicles.

Additional Coverage Options

Direct Auto also offers several additional coverage options, including:

• Accidental death coverage: Pays $5,000 to beneficiaries if the policyholder dies in a covered auto accident.
• Emergency roadside assistance: Provides 24-hour emergency towing, gas delivery, lockout assistance, battery jumpstart service, and minor mechanical repairs.
• Mexico auto insurance: Direct Auto offers car insurance for driving in Mexico, where US-based insurance doesn't apply.
• Towing coverage: Helps cover towing costs if the vehicle can't be driven due to a breakdown or accident. This is available to those with collision and comprehensive coverage on their policy; otherwise, emergency roadside assistance is needed.
• Rental reimbursement: Covers the cost of a rental vehicle while the policyholder's car is being repaired after an accident or other covered incidents.

Discounts

Direct Auto offers a variety of discounts that can help reduce the cost of a policy, including:

• Safe driver discount: For policyholders who remain accident-free for at least three years.
• Good student discount: For students with at least a B average in high school, college, or vocational school.
• Senior citizen discount: For those aged 55 or older who complete an accident prevention course.
• Driver education discount: For those who complete an accident prevention course or a state-approved driver's education course for under-21s.
• Multi-car discount: For insuring more than one vehicle with Direct Auto.
• Prior coverage discount: For those who have had continuous coverage with another insurer for at least six months without a lapse of more than 90 days.
• Multi-product discount: For bundling car insurance with life insurance or other products like roadside assistance or an emergency protection plan.
• Multipolicy discount: For purchasing multiple insurance policies with Direct Auto, such as auto and motorcycle insurance.
• Payment discounts: For setting up automatic payments, paperless billing, or paying the policy in full.
• Homeowner discount: For owning a home, townhouse, or condo where the insured vehicle is stored.
• Welcome back discount: For returning customers who come back to Direct Auto within six months of switching to another company.
• Affinity discount: For members of organizations partnered with Direct Auto Insurance.
• Military discount: For active-duty military personnel.

DynamicDrive Program

Direct Auto's DynamicDrive program is a usage-based insurance program that monitors driving behaviour through the Routely app. Policyholders receive a discount of up to 10% for enrolling, and safer drivers can earn higher savings. The app tracks factors such as phone handling while driving, driving speed, and hard and extreme braking.

Direct Auto's pricing and affordability

Direct Auto Insurance is a non-standard insurance company that provides coverage for high-risk drivers who are unable to get car insurance elsewhere. Due to this specialisation, Direct Auto's rates are slightly higher than average. The average annual cost for auto insurance with Direct Auto is $2,497, but this can vary depending on your driver's profile. For instance, if you have a clean driving record, your premium will be $2,766, while a speeding ticket will cost you $4,428 per year. If you are at fault in an accident, your premium will rise to $4,798 annually.

Direct Auto also offers full coverage for $4,128 per year, which is significantly higher than the minimum coverage option. The company provides flexible payment options, allowing customers to choose their preferred payment method, including recurring payments, one-time payments, and online or in-person payments.

Direct Auto also offers various discounts that can be combined for up to 25% off your annual premium. Some of the discounts offered include:

• Military service members can save up to 25%.
• Good student discounts of up to 10% for full-time students with good grades.
• Safe driver discounts of 10% for accident-free records in the last 36 months.
• Multi-car discounts of up to 25% for insuring more than one vehicle.
• Multi-policy discounts of up to 10% for purchasing multiple insurance policies.
• Prior coverage discounts of up to 25% for being with another insurer for at least six months.
• Paperless billing discount of 1% for choosing to receive documents electronically.
• Pay-in-full discount of up to 9% for paying the policy upfront.

Direct Auto's customer service

Direct Auto Insurance is a legitimate company that offers insurance for high-risk drivers who may not be able to get car insurance elsewhere. It is a nonstandard car insurance company specialising in policies for high-risk drivers, including those with bad credit, a lapse in insurance coverage, or a history of driving violations or claims.

Direct Auto is part of the Direct General Group, which is not to be confused with The General. It was founded in 1991 and acquired by National General Insurance in 2016, which was then purchased by Allstate in 2021. Despite the change in ownership, Direct Auto continues to operate independently and retain its name.

Direct Auto offers a range of insurance services, including car, life, motorcycle, commercial auto, and renters insurance. They also provide flexible payment plans and the option to pay in cash at one of their 400 office locations.

Customer Service

Direct Auto has a large number of customer complaints, with a level that is about six times higher than the nationwide industry average. These complaints are mostly related to claim handling, including claim delays and denials. The company also received a D+ grade from collision repair professionals for its claims handling, based on a survey by CRASH Network.

However, Direct Auto offers a variety of car insurance discounts, and their website includes detailed explanations of these discounts, as well as coverage, payment options, and claim procedures. Customers can log in to pay bills, view policy information, and file and track claims through the website.

Direct Auto's mobile app provides an easy way to access your account and includes features such as finding a local agent office, making payments, requesting roadside assistance, and reviewing policy details.

In terms of financial strength, Direct Auto is rated by A.M. Best, confirming its long-term financial stability and ability to pay claims.

Direct Auto's mobile app

Direct Auto Insurance has a mobile app, DirectDrive, available for iOS and Android devices. The app provides users with an easy way to access their accounts and perform various tasks.

With the Direct Auto mobile app, users can sign policy documents, access ID cards, make payments, request roadside assistance, file a claim, view their drivers and vehicles, coverages, and payment history, and access all other policy documents. The app also allows users to receive quotes and locate the nearest Direct Auto Insurance location.

The DirectDrive app also has features to track and monitor driving habits. It uses a smartphone's sensors to measure driving behaviours such as hard stops, accelerations, and decelerations. After each trip, the app calculates a driving score on a scale from "good" to "better" to "best" and tracks trip history. It also offers feedback on improving driving and allows users to compete with others on a leaderboard.

In addition to the app, Direct Auto Insurance also offers a text message payment option. Customers can text in their monthly payments the day before or up to three days after the due date without incurring late fees.

Frequently asked questions