You’re not likely to collect on Allstate’s auto insurance satisfaction guarantee

Photo: indi.ca

Have you ever thought your insurance company was great--until you had to file a claim?

Maybe you've seen Allstate's advertising for its Claim Satisfaction Guarantee, a promotion that addresses consumer dissatisfaction with the auto insurance claims process. The company says it will give you a 6-month credit on your premium if you’re unsatisfied with your claims experience. (However, presumably for legal reasons, Allstate says the payment of the credit doesn’t mean that it agrees with the reasons for your dissatisfaction.)

A six-month credit is worth a lot of money. According to InsWeb.com, the median six-month insurance premium in 2011 ranged from a low of $436 in Idaho to a high of $1,1111 in Louisiana.

And the only reason you might get a lesser credit is if you haven’t actually paid Allstate a full six-month premium because your policy was canceled during the period when your covered accident took place.

In that case, your credit would be no more than the prorated premium you actually paid on that vehicle.
In other words, if you take out a policy in September, get in to an accident in October and cancel your policy in November, you won’t be able to make money off of Allstate by getting a check for a six month premium when you only paid a two month premium.

That sounds fair, especially since Allstate would probably already have lost money on you from paying your claim.

In most states, the offer ends for policy periods beginning June 1, 2013 or later. So if you become an Allstate customer this year in part because of the Claim Satisfaction Guarantee but have an accident in July 2013, you’ll be out of luck if you’re not satisfied with your claim experience.

Allstate might be using this promotion to improve its image and its ranking with consumers. Two recent J.D. Power and Associates studies show that Allstate is just average among auto insurers.

USAA, which only writes policies for military personnel and their families, consistently received the highest scores of around 900. The lowest score any insurer earned in any region was 705. Allstate's scores ranged from 759 to 806.

Besides improving its general image, if the Claim Satisfaction Guarantee gets you to stay on as an Allstate policyholder despite a bad experience, it could be money well spent for the company.

If you remain a customer, Allstate gets to keep collecting your premiums. The company also saves money by not having to replace your business with that of a new customer, and acquiring new customers is expensive.

To get the full scoop on Allstate's Claim Satisfaction Guarantee, read my Interest.com article, "You're not likely to collect on Allstate's auto insurance satisfaction guarantee."

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