In actuality, over 2,400 vehicle insurance companies compete for your business across the country. Nonetheless, the majority of drivers choose to buy from a well-known brand. According to Expertise.com, which investigates and reviews top service providers, nearly 60% of respondents to a recent survey said they were more likely to buy a policy from a company they'd seen an advertisement for.

However, these insurance behemoths may not necessarily provide the cheapest auto insurance or the finest customer service.

According to the InsuredCircle rates investigation, the cheapest car insurance rates were not from one of the nation's largest carriers in 23 states.

Here are three more reasons why you might consider a lesser-known insurer.

Fewer ads may mean cheaper rates

It is not by chance that big-name insurers acquire household names. According to consumer data aggregator Statista, the four top vehicle insurance providers in the country spent more than $3.75 billion on advertising in 2020.

According to Robbie Moore, executive vice president of Blanchard & Calhoun Insurance Firm, an independent insurance agency based in Georgia, many lesser-known carriers do not spend as much money on advertising, which may balance the amount you pay for vehicle insurance.

However, there is no assurance that a smaller carrier will offer lower prices than larger brands. Shop around with a variety of businesses, both large and small, to obtain the best deal on vehicle insurance.

Better customer service

Although you may be hesitant to work with a company you've never heard of, you shouldn't assume that a lesser-known insurer would deliver poorer service.

According to data from the National Association of Insurance Commissioners, or NAIC, numerous smaller companies had less consumer complaints in the last three years than the industry's biggest brands.

Furthermore, according to a 2021 auto claims satisfaction study conducted by consumer research firm J.D. Power, only half of the eight insurers that scored above-average scores were among the nation's major carriers.

Smaller brands will frequently go above and beyond to earn — and keep — your business. "They really take the time to get to know you when you're going through a claim, and it's a very customized experience," Moore adds.

The same (or more) coverage

You would think that a firm you've never heard of would have fewer coverage options than a well-known insurer, but this isn't always the case. All auto insurers are required by law to sell the bare minimum of coverage, as well as basic policies such as comprehensive and collision insurance, which cover vehicle repairs.

Some smaller businesses may even provide coverage options or bonuses that larger corporations do not. Some carriers, for example, add complimentary extras such as accident forgiveness or pet insurance with a normal auto insurance policy.

"I believe they understand that because they are tiny and you haven't heard of them, they aren't going to gain your business based on name recognition," Moore says.

Is a smaller company right for you?

Regardless of these benefits, a lesser-known insurer isn't always the best option.

If having a tech-friendly carrier is vital to you, stick with well-known brands. A larger corporation may have more technological offerings than its smaller competitors. Before committing to a company, you should look into their app and website.

Furthermore, a smaller provider may not sell policies in as many locations as a larger brand. As a result, if you move out of the area, you may need to change carriers.

How to choose a car insurance company

Are you ready to make the transition but don't know where to start? Here's how you can begin:

• Before purchasing an insurance policy, always conduct research on the company. Confirm that it includes the coverage you want as well as any extras you want, such as accident forgiveness.
• Examine a company's financial strength to verify that it can pay out your claim if you need to file one. A rating firm like A.M. Best can help you determine a carrier's financial strength.
• Examine the NAIC website for customer complaint records.
• Consider hiring an independent insurance agent who can put you in touch with both national and local insurers. Instead of working with a single provider, these agents collaborate with a number of them. Independent agents typically operate on commission and only sell policies from the businesses with which they have partnered.