GEICO and Allstate are two of the largest auto insurance companies in the United States, with GEICO at #2 and Allstate at #4. It might be surprising to know that Allstate is only 5 years older than GEICO, having been established in 1931 compared with GEICO in 1936.
What other differences are there between the two companies, and is one better than the other?
Allstate is more than just an auto insurance company. In addition to offering the full range of insurance products, such as home, business, and life, Allstate also offers investment and retirement planning services.
Allstate operates through its network of over 12,000 agents throughout the country. Their agents are called captive agents, meaning that they only work with the Allstate company and don’t have access to any other insurance company.
Allstate also owns a subsidiary company called Esurance. Esurance is a direct-to-consumer insurance company that only offers its products online or over the phone.
Allstate’s AM Best rating is an A+.
GEICO is famous for its gecko mascot, but its full name stands for the Government Employees Insurance Company, which reflects its roots of being a private company solely targeting government employees.
GEICO is a subsidiary company of Berkshire Hathaway, a large conglomerate holding company that owns many other companies and is led by Warren Buffett.
GEICO is a direct-to-consumer insurance company that sells its policies to people online or over the phone. It does have a few agents in certain large cities in the US, but it mainly uses its network of phone and online agents to give advice to customers.
GEICO is famous for its advertisements claiming to help customers save 15% on their auto insurance rates.
It does offer other insurance products as well, but these are not actually written by GEICO. GEICO has an agreement with other companies to sell their insurance products, but the policies themselves are underwritten by another company.
GEICO’s AM Best rating is A++.
GEICO has traditionally heavily marketed nationwide to younger drivers and people who want the convenience of online shopping and policy management, but in recent years has expanded its target market to include other segments, such as families and professionals.
Allstate has traditionally marketed in a more local way, with its brand being marketed nationwide but its agents serving the local communities. However, with the purchase of Esurance, it also has a marketing segment that targets a similar demographic as GEICO does.
GEICO vs Allstate Comparison
Both insurance companies offer great discounts and service to millions of people. Their particular discounts do vary, which could give one the edge when it comes to your insurance. This is not an exhaustive list of discounts but includes the most common ones that drivers can get.
Multi-Policy Discount: Allstate offers up to a 10% discount on your auto policy and up to a 25% discount on your homeowner’s policy for bundling the two. It’s ability to write any other kind of insurance policy results in additional savings. GEICO does offer a multi-policy discount as well, but they are underwritten by another company. The discount amount varies depending on the type of policy you have.
Multi-Vehicle Discount: Both GEICO and Allstate offer discounts for having more than one vehicle insured on your policy. Allstate’s varies, but is usually between 10% – 15%, while GEICO’s standard discount is 25%.
Good Driver Discount: Both insurance companies offer big discounts for having a safe driving history of at least 3 years. GEICO offers up to a 26% discount, while Allstate offers up to a 45% discount!
Good Student Discount: If you have a student on your policy who has B average grades, or at least a 3.0 GPA, then they’ll be eligible for this discount. GEICO’s good student discount is 15%, while Allstate’s is 20%.
Telematics: Telematics is the use of drive-tracking technology that is increasingly being offered by insurance companies. You can either track your driving by using a mobile app or by easily installing a small device in your car.
Allstate’s telematics program is called Drivewise. The amount of time that you’re in the telematics program varies with insurance companies, but Allstate’s is either 6 or 12 months.
The important driving habits that telematics tracks are excessive speeds, fast accelerations, and braking, total mileage driven, and time of day.
Allstate offers a 3% discount just for signing up for the program, and drivers can potentially save up to 21% if they score exceptionally well.
GEICO is one of the few large insurance companies that doesn’t offer a telematics program.
Customer Service: Both companies offer excellent customer service, but offer different approaches. Allstate offers service through its local agents, who are able to come directly to you and offer a human touch. GEICO offers a 24-hour live-agent telephone line that offers advice, analysis, and claims service over the phone. It also has an extensive online resource center and an award-winning mobile app.
Competitive Rates: This category will vary wildly because rates are based on everyone’s unique circumstance. For example, your rates are based on your location, age, credit score, driving history, type of vehicle, number of vehicles, number and age of other drivers, mileage, coverage, etc.
For just a one-car policy, GEICO is probably going to have lower rates than Allstate most of the time. However, Allstate’s strong discounts and multiple policies might make a packaged deal more competitive.
GEICO and Allstate offer different approaches and experiences with auto insurance, but both are excellent companies that offer a variety of discounts.
Allstate is probably a better fit for families and people with multiple things to insure, while GEICO has the edge on single car, auto insurance-only households.