Loop Auto Insurance is seeking to change the way auto insurance policies are priced. The car insurance startup only offers policies in Texas while it continues to raise money for future expansion into other states. Bankrate looked into Loop’s innovative pricing model and company structure to help you decide if the new car insurance company could be a good fit for you.

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Loop uses a combination of telematics data and AI to price policies based on driving habits and road safety, rather than using mostly demographics data — like your credit rating, education level and ZIP code — to price policies. Loop contends that this will be a more fair pricing model and will help prevent unintended bias when it comes to car insurance rates.

Loop car insurance

Loop has set itself apart from other auto insurance carriers in a number of ways, despite only being available in Texas right now.

Loop is a B Corp, which means that the company is focused on more than just profits. Loop’s mission is to provide fair insurance pricing to everyone, regardless of demographics. To do this, the company plans to use an innovative pricing model which uses telematics and road safety data. The auto insurance startup seeks to eliminate some traditional pricing metrics, like credit rating, education level and ZIP code, which have historically been used to demonstrate the likelihood of a policyholder filing a claim. However, several states have begun mitigating or banning the use of such metrics, as they could potentially contribute to structural bias within the insurance industry.

Loop launched in Texas in late 2021. However, several other states could follow, with some sources claiming as many as 10 states within 12 months, including Maryland, Oregon and New York.

Types of coverage

According to the Loop app, the company offers standard auto insurance coverage options, including bodily injury liability, property damage liability, comprehensive coverage and collision coverage. Personal injury protection (PIP) and medical payments coverage are also available. Optional coverages, including roadside assistance, car rental coverage and gap insurance are available for drivers in Texas.

Potential customers who are eligible for coverage with Loop can get quotes either online or through the app. The app will use driving habit data, road safety data and factors like your state, age and driving history to rate your policy. While other companies use telematics as a discount feature, Loop uses it as one of its main pricing metrics. The app is also purported to monitor your driving behavior, give you safety tips and could even help divert you to safer roads.

Cost of Loop car insurance

Because Loop auto insurance has such limited availability, average premiums are not available. However, the company was founded on the belief that car insurance should be priced differently and that prices should be honest and straightforward. Bankrate will share rate information as soon as it becomes available.

Loop ratings, reviews, customer satisfaction and complaints

Loop has not been reviewed by J.D. Power for customer satisfaction or Standard & Poor’s (S&P) for financial strength yet, since coverage is so newly available. However, Loop closed a multi-year reinsurance agreement on August 16, 2021 with a reinsurance company that has an A+ AM Best financial strength rating.

As the company begins to offer coverage, more reviews and ratings may become available.

Reasons Loop insurance could be a good option

Loop auto insurance is exploring a new kind of pricing that could be attractive to consumers who want car insurance that is based on driving and not personal factors. For customers who appreciate technology and enjoy handling their insurance on a mobile device, Loop could be an innovative and groundbreaking auto insurance provider. The company’s B Corp designation could also appeal to policyholders who want to support businesses that give back to the communities they serve.

However, Loop may not be the right fit for customers who prefer a more traditional way of handling their financial products. The company encourages customers to handle most of their insurance business through its website or app, although it does have a toll-free telephone number as well. Loop does not have local offices.

How to sign up for Loop car insurance

While you can’t buy Loop car insurance in most states yet, the company has launched car insurance in Texas, and is aiming to spread to Maryland, Oregon and New York, among other states, soon. If you live in one of the first states where Loop is offered, you can get a quote on its website or app (available on Apple and Google Play) instantly.

If you signed up for the company’s waitlist last year (no longer available), you should be notified when Loop car insurance is available in your area.

Frequently asked questions

How do I get a quote from Loop?

Loop auto insurance is only live in Texas right now, and Texans can get a quote by downloading the app or going to Loop’s website to obtain a quote. Loop’s technology uses real-time data, including road safety information and driving habits, to determine your rate.

How do I file a claim with Loop?

Loop encourages its customers to use its website or app to get a quote and manage their policy, including filing claims. It does also provide a toll-free number on its website for customers who prefer to speak with someone when filing a claim or for other insurance-related questions.

Why does Loop rate policies differently?

Loop uses data science to rate its policies rather than traditional rating metrics like a driver’s credit tier, level of education and ZIP code. While these metrics can be used to predict the likelihood of a policyholder filing a claim, Loop feels that they could also contribute to a bias against some communities. Loop seeks to focus more on driving behavior and road safety in its pricing model.