GEICO the cheapest car insurance? Here's what we found.
One of the most important things to consider when you’re buying car insurance is how much coverage you’re getting for your money, and how much you can save by switching from one provider to another. While your policy will be dictated by state laws and your own unique needs, here’s a comparison between 4 major auto insurance providers: GEICO, State Farm, Erie Insurance, and Travelers to help you decide if it makes sense to start shopping around today.
Introduction
GEICO offers some of the cheapest car insurance rates in the country, with an average annual rate of $513 per year — $43 a month — for a state minimum coverage policy. This is 16% cheaper than the national average and 20% cheaper than their competitor State Farm's most affordable option. GEICO also has great customer service and advertises on TV, which could make it easier to get your car fixed if you are in an accident or have another roadside emergency. All this makes GEICO a great choice for consumers looking for cheap insurance quotes — but how do they compare to other companies? Read on to find out! 1) The next cheapest company we found was Erie, with an average annual rate of $591 per year — $52 a month.
2) But that’s still more expensive than GEICO by 17%.
3) In fact, both Erie and Travelers came in at about 25% more expensive on average than GEICO.
4) And while GEICO may not be able to offer as many discounts as our top two competitors (namely when it comes to bundling auto and homeowners' policies), they come very close.
5) Plus, all three of these companies offer the same amount of discounts for having multiple vehicles insured under one policy—$38 off every additional vehicle each year.
What is GEICO?
GEICO (Government Employees Insurance Company) is a company that was founded in 1936 in Washington, DC. The company has grown to become one of the largest private passenger auto insurance providers in the United States with over 17 million policies underwritten. GEICO, which stands for Government Employees Insurance Company, was founded by Leo Goodwin and his wife Lillian as a government employee benefit and its headquarters remain in Chevy Chase, Maryland to this day. GEICO primarily deals with insuring private automobiles and motorcycles in the United States, but also covers RVs, boats, trailers, and travel trailers for those who want to bundle their insurance policies together for a reduced price. It offers discounts for such things as bundling your auto and home insurance or having multiple cars insured on your policy. For customers looking to save money on auto insurance rates, GEICO’s low rates are hard to beat. The downside is that if you have an at-fault accident during the first three years of your policy, you will be charged a higher premium rate than other companies. That makes sense when you consider it as an investment in customer loyalty. There are many factors that go into determining car insurance rates including where you live, how much coverage you select and even how often you use your vehicle. When comparing car insurance quotes online, be sure to read the fine print so you know what each policy entails before choosing a provider.
How much does GEICO cost?
GEICO has low rates, but there are many types of coverage you can get and you'll want to make sure you're getting the best coverage for your personal needs. GEICO also offers a variety of discounts to help keep your rate as low as possible. Average annual rate is $513 per year with the state minimum coverage policy and 16% cheaper than the national average of $669 per year. GEICO's total score is 4 stars out of 5, which is slightly lower than the 5 stars that both State Farm and Farmers received on this list. GEICO is rated good by A.M Best Company, but it's not rated at all by JD Power or AAA — which means it may have less claims service experience than other providers in the market today. However, GEICO scores higher in customer satisfaction ratings than most insurance companies.
GEICO provides property damage liability and bodily injury liability coverages with its auto policies. Other car insurance companies typically provide these coverages only with their full coverage policies (such as State Farm) because they are higher priced options within a GEICO policy. What do these coverages offer? Property Damage Liability covers injuries to others and their property while driving your vehicle. Bodily Injury Liability covers medical expenses if you injure someone else while driving your vehicle. Personal Injury Protection pays medical expenses after an accident no matter who caused the crash; so if someone hits you from behind and breaks your arm, Personal Injury Protection would pay for treatment even though it wasn't your fault! It does not apply if someone intentionally injures you like in an assault or battery case.
How does GEICO compare to other car insurance companies?
GEICO offers the cheapest rates of all four companies, with an average annual rate of $513 per year — $43 a month — for a state minimum coverage policy. GEICO's low rates are the result of their direct writers model that eliminates brokers and agents, as well as their company-wide use of technology to streamline the claims process. If you're looking for cheaper car insurance, you should compare quotes from GEICO to your current providers before making any changes (even if it's just to shop around).
State Farm has an average annual rate of $1,096 per year — $87 a month — for a state minimum coverage policy; this is almost twice what GEICO charges on average! You'll save more than $500 over the course of a year by switching to GEICO. To compare GEICO to other companies, please read .
Erie has an average annual rate of $2,026 per year — $142 a month — for a state minimum coverage policy;
Travelers has an average annual rate of $2,239 per year — $163 a month — for a state minimum coverage policy. The difference in price between GEICO ($517) and Travelers ($2,239) isn't that dramatic compared to the difference in price between GEICO ($513) and Erie ($2026), but Travelers' claim service ratings are better than those of both GEICO and Erie.
GEICO only provides car insurance so they have nothing else to offer; for example, they don't have life insurance or homeowners insurance policies like State Farm does. In addition, because GEICO is not affiliated with any specific auto manufacturers or dealerships like most traditional car insurers are, they may be less likely to match a competitor’s pricing when new cars come out.
Conclusion
GEICO is the cheapest car insurance with an average annual rate of $513 per year — $43 a month — for a state minimum coverage policy. This is 16% cheaper than GEICO's nearest competitor and 8% cheaper than the average car insurance company in America (based on our data).
We've outlined how GEICO's price savings stack up against their top competitors, but it's important to understand why they're so much cheaper than everyone else in the first place. GEICO has been around since 1936, meaning they've had plenty of time to cut out any unnecessary expenses and find more efficient ways to do business. As a result, they can offer lower rates on policies while still achieving good results for both themselves and their customers.
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