Geico vs Nationwide Auto Insurance
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UPDATED: Apr 1, 2019
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Geico and Nationwide auto insurance companies are two of the largest auto insurance providers in the United States. Both companies have aggressively sought to build their customer base through television and internet advertising.
Both companies claim to be able to lower your rates if you switch to their products. Will you really save money? Which of these companies might be a better choice for you?
Geico is an abbreviation for “Government Employees Insurance Company,” and as an acronym, the name of the company is spelled with capital letters.
Modeled after USAA, the company for which Leo Goodwin, the founder, had worked, Geico targeted a specialized niche in the auto insurance market that was underserved by traditional insurance models by providing auto insurance to federal employees.
Today, the company boasts 10 million policies and a revenue of $9.2 billion. Geico is a subsidiary of Berkshire Hathaway Company. Although the name contains the world “government,” Geico has always been a privately held company.
Geico does not operate on an agent-commission basis, but rather uses direct sales over the internet and telephone. The money saved from agent’s commissions is used to fund television advertising.
Some of the most recognizable television insurance ads are Geico’s, including the “Geico gecko” and the “Geico caveman”.
Read a Geico Auto Insurance Review
About Nationwide Auto Insurance
Nationwide Insurance began with 1000 policyholders in 1926 as Farm Bureau Mutual Insurance Company. Farm Bureau, like many early insurance companies, was designed to insure a specific group of people, in this case Midwestern farmers, who were lacking in affordable coverage.
As the company grew, it expanded to include fire, home, and life protection. By 1955, the company had become Nationwide and was serving customers coast to coast.
Based in Columbus, Ohio, Nationwide has holdings of $21.8 billion, making it one of the largest insurance companies operating in the United States. Nationwide employees 36,000 people and has over 16 million policies in force.
Nationwide’s advertising campaign has been based on the phrase “on your side,” designed to lead customers to place faith in the giant company.
Geico vs Nationwide—Customer Satisfaction
Based on J.D. Powers and Associates customer satisfaction ratings, Geico scored a 797 on the 1000-point index, with an “average” score overall for customer assistance, pricing, and claims. State Farm was the only large company to score higher. Geico was 7th in the nation among all companies in customer satisfaction.
Nationwide scored 767 on the 1000-point index, making them the 21st in the comparison. Nationwide scored “below average” overall in customer satisfaction, although some categories, such as policy offerings, billing, and contacting the insurer had “average” scores.
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Who has better auto insurance rates – Geico or Nationwide?
In California, Geico and Nationwide have similar rate structures, often being only a few dollars apart. For example, a young female in California will pay $1,372 for Nationwide, while paying $1,315 for Geico. Texas also has similar rates, with a young female paying $1,040 for Nationwide and $1,094 for Geico.
However, in New York, the difference is startling. For young males, Nationwide charged $4,406, Geico $2,918; for young females, Nationwide was $4,002, Geico was $2,357; and older females paid $2,156 for Nationwide and $1,288 for Geico. In New York, it is clear Geico has much lower rates.
In order to determine the rate difference in your area, it is necessary to contact an agent and get a quote. No general comparison can give you a true idea of what you would pay for insurance with either company.
Which auto insurance company should I use – Geico or Nationwide?
While both auto insurance companies are financial sound and are growing in customer base, customer feedback seems to indicate that Geico is much more user-friendly than Nationwide. There could be several reasons for these customer service scores, however, that have little to do with customer service.
Many people who switch to an internet-based company expect little person service. They are switching to save money, not because they rely on a personal agent to help them file claims. If you expect little in the way of customer service, you are less likely to be disappointed.
Nationwide may well have a customer base that wants more personal attention, and may be disappointed that the company is moving in the direction of telephone and internet interaction.
Further, the number of claims filed has a great impact on customer awareness and satisfaction. As Nationwide is over twice as large as Geico, it stands to reason that more people have filed claims and dealt with the process with Nationwide.
However, logic would also decree that being a larger company, Nationwide would have more resources to deal with the claims process.
Both Geico and Nationwide are superb auto insurance companies and for most drivers it comes down to a personal choice.
When choosing between auto insurance companies always be sure that you talk to representatives from any company you consider, and make your determination only after researching all your choices.