AAA vs State Farm 2024

Founded in Chicago in 1902 to advocate for the construction of a cross-country highway system, the American Automobile Association (AAA) is a not-for-profit member association of 32 regional motor clubs across the U.S. In addition to top-rated roadside assistance and other member benefits, AAA also sells auto and home insurance in all 50 states — but it’s underwritten by a number of different companies.

State Farm specialized in cheap auto coverage for farmers when founded in 1922, but it’s since expanded to become the largest car insurance company in the U.S., with over 18 percent of the market share for private passenger auto. State Farm’s auto insurance, which is generally priced below the national average, is just one of a wide range of insurance and financial services products offered by the company.

AAA vs State Farm comparison

AAA pros and cons

State Farm pros and cons

Is AAA cheaper than State Farm?

Actual car insurance rates from AAA and State Farm vary widely based on personal rating factors, location and, in the case of AAA, the company underwriting the coverage. However, looking at average auto insurance rates for both carriers may help you determine which company might fit better with your profile. Bankrate’s insurance editorial team compiled the latest rates available from Quadrant Information Services in the table below to give the big picture of AAA’s insurance costs compared to State Farm.

As you can see, State Farm’s average rates are cheaper than AAA’s in most situations. However, it’s important to keep in mind that rates are subject to change and may vary considerably based on your individual profile. It’s also worth noting that State Farm plans to raise rates in certain states and may continue to institute rate hikes in various locations.

AAA vs. State Farm: discounts

Most auto insurance companies offer at least a handful of potential discounts. Common car insurance discounts most providers offer include bundling discounts, safe driving discounts and telematics programs. Before you decide on a carrier, it’s worth looking into the ways each company allows policyholders to save on car insurance.

Discounts available from both carriers

Both State Farm and AAA offer discounts for:

• Bundling home and auto insurance: Customers who purchase both home and auto insurance from AAA are eligible for discounts, while State Farm offers bundling discounts to auto customers who are the named insured on a home, renters, life, health or condo policy.
• Insuring multiple vehicles: If two or more vehicles in your household are insured by AAA or State Farm, you may earn a discounted rate.
• Good students: Full-time high school or college students with at least a B average or a 3.0 GPA may be eligible for discounts from both AAA and State Farm.
• Senior defensive driving: AAA and State Farm both offer discounts in some states to drivers aged 55 and older who complete an approved defensive driving course.
• Teen driver education: State Farm’s Steer Clear and AAA’s teenSMART allow young drivers to complete driver training programs in exchange for insurance discounts.
• Distant student: If your household includes a college student studying at least 100 miles from home without a car, you might be eligible for a discounted rate from either carrier.
• Vehicle safety: Both State Farm and AAA offer some discounts for vehicle safety equipment like airbags and antilock brakes, but State Farm specifies that passive restraint discounts may only be available for vehicles that are model year 1993 or older.
• Anti-theft discount: If your vehicle has an anti-theft device like an alarm, you may qualify for a discount from either AAA or State Farm.
• Good drivers: Eligibility details vary, but both State Farm and AAA advertise discounted rates for good drivers who stay accident- and violation-free for a certain period.

AAA discounts

AAA discounts may vary depending on your regional club’s offerings and the company underwriting the coverage. To help drivers understand which discounts they’re eligible for, AAA offers a free Triple Check policy review program.

• Member discounts: AAA members can earn a 5 percent discount on auto insurance, along with discounts and deals for gas, rental cars and much more.
• Advanced shopping discount: Drivers may be eligible for a discount of up to 12 percent if they purchase a policy more than seven days before the coverage begins on a vehicle that was previously covered by another policy for at least six continuous months.
• Loyalty discount: Policyholders may save if they have had a continuous AAA auto insurance policy for a set number of years.
• Payment discounts: Policyholders who set up paperless billing or pay their premium in full may be eligible for discounted rates from AAA.

State Farm discounts

• Accident-free discount: Policyholders may receive a discount for remaining accident-free for a set period of time. Savings may increase every year without an accident.

AAA and State Farm telematics programs

In recent years, most major auto insurers have adopted smartphone-based telematics programs, which allow drivers to earn potential discounts based on safe driving data tracked by an app. Both AAA and State Farm offer telematics programs. We’ve highlighted State Farm’s Drive Safe & Save program, but it also offers a Steer Clear program for drivers under 25. Depending on their location, AAA customers may be eligible for one of a few different telematics programs, including AAADrive, AAA OnBoard and SMARTtrek. We’ve highlighted AAADrive here.

AAA vs State Farm: customer experience comparison

Customer service and satisfaction may be a key metric for many drivers choosing a car insurance company. Mobile app ratings may help drivers determine how easily they can access digital tools and file claims. We also analyzed the J.D. Power 2023 U.S. Auto Claims Satisfaction Study to see how satisfied customers may be with each company’s service. For reference, the segment average in the J.D. Power study is 878/1,000.

Customer complaints

The National Association of Insurance Commissioners (NAIC) tracks customer complaints for U.S. insurers and assigns a score to each company based on its rate of complaints relative to market share. The resulting score, known as an NAIC Complaint Index, gives a general indication of how satisfied (or dissatisfied) policyholders are with a particular company. Scores above the baseline of 1.00 suggest overall dissatisfaction, while scores below 1.00 indicate that the company’s customer service may be better than most.

AAA auto insurance customer complaints

Because AAA auto insurance policies are underwritten by multiple companies, we looked at NAIC scores for three of the largest AAA insurers: Auto Club Property-Casualty Insurance Company, Automobile Club Group and CSAA General Insurance Company. CSAA’s scores were the most consistently positive, but AAA complaint indexes appear to be improving across the board.

State Farm auto insurance customer complaints

Despite its large size, State Farm receives a below-average rate of complaints, with a 2023 NAIC Complaint Index of 0.78. However, the past few years have seen a small but steady increase in complaints from State Farm private passenger auto customers.

Frequently asked questions

Methodology

Bankrate utilizes Quadrant Information Services to analyze April 2024 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted based on the population density in each geographic region. Quoted rates are based on a single, 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:

• $100,000 bodily injury liability per person
• $300,000 bodily injury liability per accident
• $50,000 property damage liability per accident
• $100,000 uninsured motorist bodily injury per person
• $300,000 uninsured motorist bodily injury per accident
• $500 collision deductible
• $500 comprehensive deductible

To determine minimum coverage limits, Bankrate used minimum coverage that meets each state’s requirements. Our base profile drivers own a 2022 Toyota Camry, commute five days a week and drive 12,000 miles annually.

These are sample rates and should only be used for comparative purposes.

Credit-based insurance scores: Rates were calculated based on the following insurance credit tiers assigned to our drivers: “poor, average, good (base) and excellent.” Insurance credit tiers factor in your official credit scores but are not dependent on that variable alone. Four states prohibit or limit the use of credit as a rating factor in determining auto insurance rates: California, Hawaii, Massachusetts and Michigan.

Incidents: Rates were calculated by evaluating our base profile with the following incidents applied: clean record (base), at-fault accident, single speeding ticket, single DUI conviction.

Age: Rates were calculated by evaluating our base profile with the ages 18-60 (base: 40 years) applied. Depending on age, drivers may be a renter or homeowner. Age is not a contributing rating factor in Hawaii and Massachusetts due to state regulations.

Bankrate Scores 

Our 2024 Bankrate Score considers variables our insurance editorial team determined impacts policyholders’ experiences with an insurance company. These rating factors include a robust assessment of each company’s product availability, financial strength ratings, online capabilities and customer and claims support accessibility. Each factor was added to a category, and these categories were weighted in a tiered approach to analyze how companies perform in key customer-impacting categories.

Each category was assigned a metric to determine performance, and the weighted sum adds up to a company’s total Bankrate Score — out of 5 points. Our scoring model provides a comprehensive view, indicating when companies excel across several key areas and highlighting where they fall short.

• Tier 1 (Cost & ratings): To determine how well auto and home insurance companies satisfy these priorities, average quoted premiums from Quadrant Information Services (if available), as well as any of the latest third-party agency ratings from J.D. Power, AM Best, Demotech and the NAIC, were analyzed.
• Tier 2 (Coverage & savings): We assessed companies’ coverage options and availability to help policyholders find a provider that balances cost with coverage. Additionally, we evaluated each company’s discount options listed on its website.
• Tier 3 (Support): To encompass the many ways an auto insurance company can support policyholders, we analyzed avenues of customer accessibility along with community support. This analysis incorporated additional financial strength ratings from S&P and Moody’s and factored a company’s corporate sustainability efforts.

Tier scores are unweighted to show the company's true score in each category out of a possible five points.