Last updated: December 12, 2015 at 17:51 pm

Taking a Look at Direct Auto Insurance

direct auto insurance

Direct Auto Insurance is privately owned and not the same as Direct General Auto Insurance. The first is based in Chicago while Direct General has its headquarters in Tennessee and is part of the Direct General Corporation.

Direct Auto was established in 2007 and prides itself in its conservative business approach to insurance, investments, and financial auditing services. In insurance, they work mainly with non-standard auto insurance, accident protection, and life insurance for the Hispanic and African American communities. They claim to have an extensive line of coverage options, bilingual employees, and affordable rates.

Direct Auto Full Coverage Option

Direct Auto Insurance is a regional insurance company with 0.16% of market share. They target drivers with a tight budget and are able to offer a number of discounts. However, since the company is small, it cannot compete with the national insurance companies and still have relatively higher rates. In the same manner, they do not have full coverage options other than:

  • Emergency roadside assistance
  • Rental reimbursement
  • Comprehensive
  • Collision

Overall Performance

insurance company satisfaction

Direct Auto is a holding company which means it is a broker and works with independent insurance agents. They offer the usual range of discounts which, when coupled with their low rates, translates to one of the cheaper auto insurance premiums.

The company is not BBB-accredited but out of the 56 complaints filed, only a few remain unresolved.

If one were to base a review of Direct Auto on news and customer feedback, the review would merit a 1 or 2 star result. Direct Auto is currently fighting a class action suit that was filed in 2014 for refusing to honor policy holder claims. The lawyers representing the policy holders are seeking damages for breach of contract, fraud, and alleged violation of the state insurance code.

However, since the lawsuit is still pending, it would be unfair to say that Direct Auto Insurance is to be avoided. The company is known for its friendly service and ease in signing up for a new policy. Unfortunately, their website leaves a lot to be desired since it offers very little information but their person-to-person chats through their call center and direct marketing approach appears to be working well because they specialize in explaining to their customers their insurance coverage in a manner that makes it easier to understand.

The company has more than 400 local licensed agent offices, mostly located in the Southeast, and reports more than $450 million in annual revenues.

Discounts

direct auto discounts

Direct Auto offers the following discounts to eligible customers: safe driver and good student (up to 10%), multiple vehicle, military service or veteran or loyal customer (up to 25%), group or professional organization, low mileage, seniors or retired (up to 5%), bundled plans (up to 15%) except for bundled auto and life insurance which is eligible for up to 5% discount only.

The exact discount rate will be determined by the insurance agent in consultation with Direct Auto so the rate can vary based on personal circumstances and history.

Comparison

According to Credio, the review website, Direct Auto scores only 2.7/5 in terms of affordability and 1.9/5 in customer experience. Even the company’s financial strength barely makes it with a 2/7/5 rating.

However, if one were to factor in that this company is barely 8 years old and compare it with insurance companies that have been around for decades, one should give the company some leeway in terms of being one of the “new kids on the block.”

Credit can be allowed for being included among insurance companies reviewed by car insurance websites such as Insurantly and others. As an average-sized company, it enjoys only 0.16% market share

Being a broker with hundreds of agents, Direct Auto is good at personal meet-ups where one can get all the information needed in one meeting. Also personally knowing your agent gives you the opportunity to call this agent when you figure in an accident or need assistance with your policy.

The downside is that agents usually work only during business hours and the company is not consistently effective with their call service system.

Direct Auto offers limited add-on coverage: emergency roadside assistance and rental reimbursement. Both options require extra premium payment. Fees that will be collected from policy holders are $50 for late premium payments and 10% of the remaining balance of your total premium for pre-termination of policy.

Unlike top insurance companies, Direct Insurance gets at best a B+ rating on its financial stability and performance. Some of the issues that have come up regarding Direct Insurance is not reassuring because they keep recurring. A few of these issues are rate increases without warning or consent and delayed responses from the agent or company representative.

The website is also a major issue because it gives out very little information and does not offer online quotes. You will have to contact them in more traditional ways, relatively speaking which is through phone, fax, or email.

In a comparative study done on Illinois insurance groups, Direct Auto was not among the top 60 of the state. It only merited mention in a Top List as the Top 4 insurance companies in Illinois with a poor complaint ratio – and this list was released by the Illinois Department of Insurance.

This company is also one of the few with an unofficial Facebook account used by persons with complaints against the company. The Facebook account is about a year old and does not have many entries but the few entries it does have is mostly negative feedback.  In addition, based on Google Reviews, all 22 reviews have rated the company poorly.

A possible confusing issue for consumers looking for Direct Auto online is that a search query of this company always leads to Direct General Insurance which has earned higher reviews and ratings. Also, there seems to be almost complete silence from the company about their business.  There is no available information about the people behind the company and their credentials.

Full coverage car insurance

Have questions about full coverage? Insurantly has the answers including tool to compare quotes. Learn more..

High risk car insurance

Are you a high risk driver? Insurantly provides in depth coverage on this topic. Learn more..

Liability insurance

What is liability car insurance? Insurantly goes through and explains what liability insurance coverage is and why it’s important to you.

Personal injury protection

What is personal injury protection and what does it cover? Insurantly offers clear understandable information about how it works. Learn more..

Car insurance rates by state

Every state has unique insurance laws and requirements. Navigate to Insurantly’s state page and learn more about your state auto insurance coverage.