Why did Wells Fargo leave personal insurance and agree to pay $386 million to its auto loan customers?
If you are here to find out if you can buy auto insurance from Wells Fargo, we’re here to tell you it’s a no-go. Our team took a close look at the company, its customer reviews and more, including the reason why it was in the news so much last year, and compiled our findings for you right here.
Does that leave you without a front runner for a provider? We’ve researched the top car insurance coverage with the most affordable rates. Our comprehensive and detailed review of the best car insurance providers in the U.S. can help narrow down your options and decide which companies to call and get a quote.
Whenever you shop for car insurance, we recommend getting quotes from multiple providers so you can compare coverage and rates. In addition to the insurance company you choose, factors such as your age, vehicle make and model, and driving history can affect your premium, so what’s best for your neighbor might not be best for you.
Use our tool below or call (844) 246-8209 to start comparing personalized car insurance quotes:
In this article:
- What Happened To Wells Fargo Auto Insurance?
- Wells Fargo Customer Reviews
- Who Should Provide Your Auto Insurance Instead?
- Questions To Ask When Comparing Quotes
- FAQ: Wells Fargo Auto Insurance
What Happened To Wells Fargo Auto Insurance?
In 2017, San Francisco-based Wells Fargo, one of the largest banks in the U.S., announced its design to exit the personal insurance space, which included homeowners, renters, and auto insurance, and focus mainly on banking, investments, and lending. As a result, the firm does not currently feature any home or auto insurance programs on its website. In some states, though, the parent company, Wells Fargo & Company, may still offer some insurance products through non-bank affiliated insurance agencies.
The last few years have seen Wells Fargo having to fight a number of high-profile legal and operational battles, including a fake accounts scandal, multiple renters insurance violations that led to the company giving up its California insurance license for three years, and a class action lawsuit involving the auto insurance program and customers who had taken out an auto loan from the company.
Before it was shut down in September 2016, the Wells Fargo auto insurance program, called Collateral Protection Insurance (CPI), worked like this. If you had financed your vehicle with a loan from Wells Fargo Auto, a subdivision of Wells Fargo bank, you may have been required by your loan agreement to maintain comprehensive and collision physical damage insurance, naming Wells Fargo as “loss payee” or “lienholder.” The cost of the policy was passed on to the borrower to be paid separately or along with the premium with interest.
If Wells Fargo did not receive proof that you had sufficient insurance coverage, it could buy CPI to protect its interest in your vehicle. You were required to pay for the time during which the coverage the company bought was in effect and you did not have insurance that met the company’s requirements. When the company received evidence that you had sufficient coverage for some or all of the time the CPI was placed on your account, the policy would be canceled and any payment for unneeded CPI would be refunded.
Last year, the company reached a $386 million deal to settle a class action lawsuit that alleged the bank had forced customers to buy unnecessary and expensive auto insurance – even when they already had it – and forced many of them into delinquency or into having their vehicles repossessed as a result of the unnecessary costs. National General Insurance, from whom Wells Fargo had been buying the insurance and which reportedly paid the company in unearned commissions, agreed to pay an additional $7.5 million as part of the settlement. Though Wells Fargo denied any wrongdoing on its part, it said it would devote most of the settlement funds to repair the damage suffered by customers as a result of the errors in its programs.
Wells Fargo Customer Reviews
Wells Fargo has been embroiled in many scandals over the last few years, and several online reviews we read as part of our research into the Wells Fargo auto insurance program revealed a great deal of customer dissatisfaction over the bank’s practices. The bank has closed 3,263 complaints across its divisions on the Better Business Bureau website in the last three years alone.
Wells Fargo also has an F rating on BBB due to government actions against the company as well as its failure to respond to over 150 complaints filed on the website. To help you find a company with better customer service, call (844) 246-8209 or fill out the form below.
Who Should Provide Your Auto Insurance Instead?
While you may not be able to buy your auto insurance from Wells Fargo, don’t forget there are several other options out there if you are shopping for car insurance. We recommend going through our extensive review of the 12 best car insurance providers in the country before making a decision.
During our research, we took a deep dive into several aspects of each company, including financial stability, coverage options, and customer satisfaction. USAA, GEICO, and Progressive impressed us the most.
Why We Like USAA
Free online quotes, great service for members of the military and their families, reasonable rates, several discount options, and more make USAA car insurance our No. 1 auto insurance provider. Read all about it in our USAA auto insurance review.
Why We Like Geico
Ranked second on our list, Geico auto insurance is one of the largest auto insurance providers in the country and offers great coverage for drivers. With Geico, you may also have the option to bundle your car and home insurance and save money. Read all about it in our Geico review.
Why We Like Progressive
With affordable coverage options, useful add-ons, and an established presence in the industry, Progressive car insurance is our No. 3 pick. Read all about it in our Progressive insurance review.
Questions To Ask When Comparing Quotes
While these companies are undoubtedly some of the best auto insurance providers in the industry, it’s always a good practice to obtain at least three quotes to ensure you get the best possible coverage at the right price.
When comparing insurance quotes and providers, here are a few things to keep in mind.
- Does the company have a good reputation? How good is its customer service? While it’s impossible today to find a company that has only positive online reviews, it’s important that you feel comfortable and confident about your decision.
- Is the company financially stable? You don’t want to be put in a situation where your insurance company can’t pay your claim because of its poor financial status. The financial strength of insurance companies are rated by independent agencies like AM Best, Moody’s, and Fitch. A quick look at their latest reports can give you an idea of the company you’re researching. Both Geico and USAA have an A++ rating from AM Best, which is the highest, while Progressive is close behind with an A+ rating.
- Do all the quotes offer the same coverage? Price should not be the only consideration when evaluating your insurance options. Lower premiums may mean lower coverage and more out-of-pocket expenses if there is an accident.
- Does the quote take into account the discounts you are eligible for? Many insurance companies offer several discounts for students, homeowners, seniors, etc. that may apply to you and bring down your premiums.
Use our tool below or call (844) 246-8209 to start comparing car insurance quotes:
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