Online Insurance Review for GEICO
The Government Employees Insurance Company (GEICO) was started in 1936 to provide auto insurance to employees of the federal government. It was founded by Mr. Leo Goodwin and his wife Lillian on the heels of the Great Depression. Over the past 75 years GEICO has grown into a $ 28 billion company with 24,000 associates in 12 major locations in all 50 states. In 2010 GEICO surpassed the 10 million customer mark and is moving ahead in all areas of their business. Today, GEICO offers auto, home, life, and umbrella liability policies. Perhaps best known commercially for their clever and infectious TV spots featuring Cavemen or the little Gecko character – GEICO has successfully used pop culture and new media to get their long-held company values of excellent coverage, low prices, and outstanding customer service to a much wider audience. GEICO has gained market share over the years at the expense of both the major insurance carriers and the smaller providers who have not been able to match GEICO’s aggressive growth of the past 20 years.
Key Steps to Buying Insurance Online
- Evaluate what insurance risks your lifestyle presents – auto, home, life, health, disability
- Estimate the potential loss ($ value) that may result from a claim
- Search for insurance products that cover the potential loss
- Identify insurance providers that provide coverage, limits and benefits vs. premium ($ cost)
- Select an insurance provider and product that offer the appropriate coverage vs. premium
The GEICO product offering consists of auto (boat, RV, motorcycle, ATV, collector autos included), home (condo/townhome/single family, or renter), life insurance, umbrella liability, and flood insurance. The main focus of GEICO’s efforts over the years has been auto insurance and this is where their deep expertise in quoting new coverage and servicing existing policyholders is clear. GEICO entered the insurance markets for home, life, and disability after many years of working with auto policyholders and applies their competence and experience to these products as confidently as they do to auto insurance. While home, life and disability insurance is quoted and underwritten differently than auto insurance – it provides GEICO with an attractive group of products that enables them to capture more customers and therefore more revenue per customer by selling them additional insurance coverage.
The most common GEICO auto insurance policy consists of coverage for bodily injury liability, property damage liability, medical payments and uninsured motorist bodily injury as well as uninsured motorist property damage. Additional coverage might include; comprehensive, collision, emergency road services and rental car reimbursement. Since all states have enacted mandatory minimum auto insurance levels, the auto insurance market has a “floor” when it comes to “basic” coverage these days. When you see a coverage limit of 50/100/25 it refers to coverage of $ 50,000 per person for bodily injury liability, $ 100,000 per accident for bodily injury liability and $ 25,000 per accident for property damage. Insurance for comprehensive which can include damage from fire, flood, theft or vandalism is usually quoted as a deductible amount of anywhere from $ 250 to $ 1,000 from your total policy. The collision portion of your policy covers damage to your vehicle caused by another vehicle or object that hits it or that you vehicle collides with. Emergency road services coverage may pay for towing, tire repair, lockout, or a dead battery re-charge.
Homeowners insurance covers the cost of repair to your home if the structure or personal property is damaged or destroyed. GEICO typically covers cost of replacement, personal property, and loss of use of the home for the period that it is uninhabitable. There may be coverage for medical payments, special property (jewelry, artwork, collectibles, etc.), water damage, or even identity theft. Homeowners may have some liability coverage for accidents that occur in the home or on the property surrounding the home. The majority of homeowner’s policies include liability coverage for accidents that occur on the property, but do not result in damage to the structure or damage to personal property or possessions. Some events that take place outside the home and off the property may be covered by homeowner’s liability coverage if the policy includes it. GEICO provides discount pricing for homes with added safety features like; deadbolts on all external doors, fire sprinklers, fire extinguishers, smoke detectors, and central station burglar and fire alarms that are monitored. GEICO offers a separate policy for non-owners or renters that provide coverage for personal property and possessions and liability claims for accidents. GEICO policies do not cover damage from floods or earthquakes unless a special policy is purchased. You may buy flood insurance from GEICO directly or where there are designated flood areas there may be federal coverage if private insurance is unavailable or inadequate. Earthquake coverage covers damage caused by an earthquake or seismic event. California – the state most impacted by earthquakes – has tried to manage this risk to residents by actively monitoring insurers and policing business practices and requiring any insurer who offers property insurance in the state to also offer earthquake coverage. Many insurers stopped writing coverage for earthquakes so California created the California Earthquake Authority (CEA), which in turn created a “mini-policy” designed to cover the main dwelling, but not swimming pools, outbuildings and other non-essential structures that don’t put “a roof over your head”.
GEICO provides life insurance pricing via Life Quotes Inc. and the actual policies from traditional life insurance carriers like Transamerica or Prudential or Mutual of Omaha to name just a few. The standard life policy is a simple contract where the policyholder pays the premium and the insurance company agrees to pay the beneficiaries a death benefit if the policyholder dies during the term of insurance. Over the years life insurance has evolved from whole life with a cash savings benefit to a more streamlined offering that provides the benefit during a specific time period – called term life insurance. Term life products have overtaken whole life and continue to grow as interest in providing maximum benefits during a more narrow time frame becomes the objective of most people seeking life insurance. Typically the customer is looking for a term period that coincides with their most important life events and financial obligations such as marriage, a home and children. Utilizing the limited time period of term life allows policyholders to buy more insurance benefit for less money when their obligations are the most at risk – i.e. an outstanding mortgage balance, cost of raising and educating children and providing a measure of stability in the absence of a parent or loved one who supported them financially. The large number of life insurance carriers that GEICO offers via their online quote interface rivals that of other internet-based services and comes with the buying power of GEICO behind it.
The umbrella insurance for liability offered by GEICO is well-positioned within their other insurance offerings. Umbrella insurance is a just what it sounds like – it is a separate policy the “covers” you, your home or your vehicle in the event that a liability claim exceeds the liability limits of your existing homeowners or auto policy. If for example you have a serious auto accident and are determined to be a fault, and if the claim against you is in excess of your auto liability coverage you may be sued for the balance.
Someone once said that paying for and maintaining your insurance is best viewed as an investment, not an expense. While this is an optimistic, if not rational way to view the tens of thousands of dollars that you’ll inevitably pay in premiums throughout your lifetime – it can be a little difficult to get you head around the reality that when you have good insurance that you’ve paid good, hard-earned money for – you never, ever really want to have to use the insurance. GEICO was founded on the principles of providing policyholders with excellent coverage, low prices, and outstanding customer service and over the past 75 years GEICO has built upon these beliefs to grow their customer base past 10 million policyholders. In our review we found GEICO premiums to be very competitive with other insurance carriers. For auto insurance, GEICO was only $ 8 more per month and this was due in part to the absence of a multi-policy discount (GEICO offers up to 15% off your policy if you maintain other lines of insurance with them)that the other carrier included. The GEICO homeowner’s policy was higher by 10-12%, but this quote was obtained after all carriers announced that rates would be increasing due to storm-related claims over the past several years. Life insurance from GEICO was lower by 15-20% than other carriers and provided by A+ A.M. Best –rated insurance carriers for a 20-year level term life policy of $ 500,000.
GEICO is able to offer competitive premiums because they don’t have the costly expense of thousands of insurance agents sitting in thousands of remote offices where business walks in the door. GEICO has saved money by not selling insurance on a local level and staffing and supporting that effort. Instead they have offices that cover more geographic area and have leveraged the internet and simple telephone communication to reduce costs and improve customer service.
The internet has the ability to reduce time and improve service delivery and quality. GEICO appears to have mastered this understanding and invested in the technology and personnel who support this interface. The time spent online entering information to get quotes on auto, home, or life insurance was not lengthy or particularly challenging. The user screens are tied into several insurance databases that make it easier for GEICO to more quickly identify who you are and what type of property (auto, home or life) you are trying to get coverage quoted for. All of the insurance companies share and maintain databases with vehicle, housing, medical/health data already contained in them and this is compared to claims history to determine what your insurance score or claim experience is and a profile or likelihood of future claims and cost is projected into the premium calculation. While the data entry of your personal information may take up to 10 minutes or more – the processing time of that data and the computation of your estimated premium – takes a mere seconds to be displayed to you.
Underwriting for life insurance may require a more detailed review and even a medical exam in some situations, but the initial effort to collect and crunch numbers can be done securely online from the comfort of your kitchen table. All of your information is saved on GEICO.com and you may return at any time to review them or even to update information that you may not have had access to when you filled out original paperwork.
Ease of Use
Using GEICO.com to enter personal information, select coverage and review quotes was generally easy with a few exceptions. Missing a single field in the auto quote application could cause error messages to be displayed when trying to finalize the quote. The life insurance quote engine from Life Quotes Inc. was very good, but confusing in some areas due to small print and the alignment of yes/no buttons to indicate responses to questions like “has a doctor recommended a medical procedure or test that you have not yet completed?” Several screens could benefit from a more highly visible BACK button or a SAVE feature that would allow the user to resume data entry a later point.
The internet interface is a familiar one for most people, but do not get complacent as you complete the forms or you may inadvertently disclose more than you intend to and make sure that any of your personally identifiable information – social security number, telephone or address is well protected from casual onlookers or professional fraudsters and scammers. Online applications and processing are a real convenience, but please guard your identity and medical or insurance history carefully to avoid theft or mis-use of your information. GEICO sent several emails following the online application for auto, home, and life insurance and each of them were careful not reveal or expose any sensitive information related to identity or insurance history.
GEICO has a built an online product information and data collection tool that is both comfortable and comprehensive. They have assembled the essential elements to provide a website that is focused on the customer experience and makes it easier to understand the insurance products and their key features and benefits. The pricing is competitive and the monthly payment plans are flexible. The time requirement is moderate and the potential savings over an in-office visit to an agent’s office is high given the ability to provide accurate information to GEICO and allow real-time processing of your personal data. GEICO.com does not disappoint prospective policyholders and the menu option to make payments online, manage your account information or file a claim online demonstrates their commitment to offering excellent coverage, low prices, and outstanding customer service – 24 hours a day, seven days a week.