These days, a lot of people do not want to have to go through an agent to get their auto insurance as this may be considered by some to be the old way of doing things. Instead, consumers want to take control of purchasing their auto insurance without an agent trying to sell them more than they need and taking a commission fee from the sale.
This is one reason that a number of digital direct-buy auto insurance companies are emerging. These insurance companies do not have physical offices nor are their policies sold by independent agents and brokers. Instead, these automobile insurance companies sell their policies directly to customer online with websites and apps that allow consumers to take charge of the entire process of buying car insurance from the company. Geico, Progressive and Esurance are three of the largest national digital direct-buy car insurance companies in the country.
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Geico, founded in 1936, is the second largest auto insurer in the United States with $25.48 billion in revenue in 2017. It also has an A.M. Best rating of A++, making it a very strong company financially. The company has more than 15 million auto insurance policy holders. Geico is a subsidiary of Berkshire Hathaway. The company’s headquarters is in Maryland. In addition to auto insurance, Geico sells Homeowners insurance, renters insurance, condo insurance, landlord insurance flood insurance, business insurance, umbrella insurance, life insurance travel insurance, pet insurance, and jewelry insurance. Geico’s insurance is available in all 50 states. The company has a good reputation based in large part on its advertising and low rates.
Progressive, founded in 1937, is one of the largest insurance company in America today with a total revenue of $30 billion in 2018. This company has an A.M. Best rating of A+, meaning that it is a very solid company financially. The company is headquartered in Ohio and now sells auto insurance in Australia as well. In addition to auto insurance, Progressive also sells property insurance homeowners, homeshare, mobile home, renters, condo, and flood insurance. Moreover, the company offers business insurance, health insurance, life insurance, pet insurance, travel insurance, umbrella insurance, Mexican auto insurance, personal loans, home financing and more. Progressive’s insurance is available throughout all states in the US. Progressive also has a good reputation based in large part on its advertising.
Esurance, a direct seller of insurance, was founded in 1998. It is a wholly owned subsidiary of AllState as it was purchased by AllState in 2011. The company has an A.M. Best rating of A+. Esurance generated $1.03 billion in revenue in 2012. Instead of having offices customers can visit, Esurance sells its insurance over the phone and the internet. In addition to auto insurance, Esurance also sells property insurance, business insurance, pet insurance, life insurance, health insurance, and Mexican auto insurance. Esurance is available in 43 states. Esurance’s reputation is not quite as solid as the other two companies; however, its advertising has made it popular.
- Availability: Geico and Progressive
- Best Rates: Geico
- Coverage Options: Three-way tie
- The Most Discounts: Esurance. It is difficult to determine the winner in this category since each company has a selection of discounts. The best company for you in this category is the company that offers the most discounts for which you qualify. In this case, we should Esurance is the winner since the discounts they offer are probably the most suitable for most of our young readers.
- Telematics: Esurance and Progressive
- Customer Satisfaction and Claims Handling: Geico
- Best Special Features: Progressive’s ‘Name Your Price’ tool.
- Best Digital/Online Experience: Geico
- Best Other Insurance: Progressive (due to its low complaint ratio)
Geico and Progressive are available in all 50 states. Even though Esurance is an online auto insurance company, it is not available in every state in the country. Esurance is not available in Vermont, New Hampshire, Delaware, Alaska, Hawaii, Montana, or Wyoming.
Geico, Progressive, and Esurance: Which Company Offers The Best Rates?
An auto insurance company’s rates are very important when shopping for auto insurance. In fact, this is one of the top criteria that consumers look at when trying to select an insurance company. Car insurance companies base your rates on a combination of their base rate, your age, your address, the type of vehicle that you drive, your coverage options, and your driving record. In addition, car insurance companies sometimes base your rates on your marital status, gender, and credit score.
Here is a glimpse of how each of the three companies’ rates compare to each other.
|18 year old Male (no accidents)||$10,237||$4,160||$7,430|
|18 year old Female (no accidents)||$8,301||$4,754||$8,590|
|40 year old married couple (no accidents)||$3,902||$1,648||$3,083|
|40 year old married couple (One accident)||$6,223||$3,258||$5,689|
Geico’s rates beat that of the other two companies in all categories. In fact, if rates are what you are concerned about, Geico is easily the best of the three companies for you to choose. Furthermore, while Esurance and Progressive’s rates are comparable in most categories, Esurance should be avoided by young male drivers.
However, you should keep in mind that Geico might have the lowest rates in general, your lowest rates might not Geico’s since different companies assess risks completely differently. The only way for you to know who offers you the lowest rates is to shop and compare your quotes from different companies.
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Which Coverage Options Does Each Company Offer?
|Uninsured/ Underinsured Motor Vehicle||Yes||Yes||Yes|
|Rideshare Driver Coverage||Offers one policy to cover you for both personal use and driving for Uber or Lyft||Yes||Only to customers in California|
|Car Rental Reimbursement||Yes||Yes||Yes|
|Gap Insurance||No||Yes up to 25% of the actual value (also called Laon/Lease Payoff)||Yes|
|Sound System Insurance||No||Progressive offers custom parts and equipment value which is similar but covers more than sound systems||No|
|Personal Injury Protection||Yes||No||Yes|
|Property Protection Coverage||No||No||No|
Thus, each company offers the same amount of coverage options, similar to most major national auto insurance companies. This is not where you will typically find a difference.
Which Company Offers The Most Discounts?
|Multi-policy Discount||Discount varies||Save an average of 5%||Discount varies|
|Telemetrics||No||SnapShot approx. $130||DriveSense 10% discount for good driving|
|Safe Driver Discount||26% discount for five years accident free||Save up to 31% for no accidents or tickets in 3 years||Claim-free discount 10-25%|
|Multi-Car Discount||Up to 25%||Save an average of to 10%||Discount depends on type and number of vehicles|
|Homeowner Discount||Average savings almost 10%||Discount varies|
|Purchase Online||Nearly 8% discount, also a discount for getting an online quote||Fast 5 discount for starting a quote online 5% discount|
|Student Discounts||15% discount for being a good student||Good Student & Student Away||Good student discount up to 40% off premiums|
|Driver Education Discount||Discount varies for completing defensive driver or driver education courses|
|Safe Vehicle||40% discount for full front seat airbags, 25% discount for anti-theft system|
|Policy Discounts||Pay in full discount, Automatic payments discount, continuous insurance discount, paperless discount|
Thus, all three of these auto insurance companies give discounts. The discounts that are available probably add up to approximately the same amount of savings. Therefore, check with each of these insurance companies to see which company offers the most discounts which you qualify for.
Esurance, however, may have a number of unique discounts that are not listed on its website. For example, they have a Pac-12 discount for students and alumni of Pac-12 universities.
Which Companies Offer Telematics?
For the digital generation, telematics is a big welcome change to the way that car insurance works. Telematics allows you to attach a digital device to your car to measure your driving habits. Your car insurance bill is adjusted to reflect your good driving. This gives you a chance to control your car insurance bill. Furthermore, you learn ways to improve your driving habits to keep you safe.
Progressive introduced the first successful telematics program for the digital generation with Snapshot in 2010. By 2015, nearly 35% of Progressive’s direct motorists had signed up for Snapshot in order to lower their premiums by improving their driving behavior. The average driver with SnapShot pays over $200 less a year than the average Progressive driver that does not have SnapShot.
Esurance’s DriveSense is similar to SnapShot and customers of this car insurance company can save money by improving their driving habits as well.
Geico does not currently have a telematics program to allow good drivers with their auto insurance to save money.
Consumer Satisfaction With Customer Service and Claims Handling
The value of a car insurance company rests in its claims handling. There is simply no point to purchasing coverage if it does not protect you when you file a claim. Therefore, it is important to examine the claims handling experience that each company has to offer.
Filing a claim with each of these companies is easy. You can simply go on their website and file the claim online. If you have trouble filing your claim, or need some assistance, you can call their claims or customer service phone number to get some assistance.
The best way to gauge claims satisfaction for a large national auto insurance company is to go by the J.D. Power 2018 US Auto Claims Satisfaction Study. This is a study that J.D. Power conducts every year in order to rate auto insurance companies based on their claims handling. Each year, J.D. Power surveys an estimated 10,000 consumers who have filed a claim in the last six months. Insurance providers are ranked on a 1000-point scale based on the results of the survey. The national average score for a US auto insurance company is 861/1000. Below are the results of the three companies:
- Geico: 857/1000
- Progressive: 849/1000
- Esurance: 852/1000
- Therefore, Geico outperformed the other two companies in the area of claims handling.
J.D. Power also conducts an insurance shopping study every year to gauge which company makes buying insurance the easiest and leaves the customers the most satisfied. The J.D. Power 2018 U.S. Insurance Shopping Study was conducted in much the same way as its Auto Claims Satisfaction Study with insurance companies being ranked on a 1000-point scale. The national average rating for insurance companies included in the study was an 839/1000.
- Geico: 844/1000
- Progressive: 831/1000
- Esurance: 829/1000
- Thus, Geico again outperformed the other two companies.
What Special Features Does Each Company Offer?
Most auto insurance companies have a main selling point that makes it stand out from its competition. Geico’s main hook seems to be their low rates. These tend to be lower than that of all other major reputable auto insurance companies unless you fit into an exception category. This is actually a great lure which has proven to be successful for the companies and may be the main reason that it is the biggest of the three. Furthermore, Geico offers an excellent online platform for its customers which allows them to find the information that they need to make an educated decision on car insurance.
Progressive offers the ‘Name Your Price’ tool which allows customers to select how much they want to pay for auto insurance and what type of coverage they want. The company will then show you the coverage and limits that you can get for that price. This makes it easier for you to find auto insurance that is within your price range with your desired coverage.
Esurance claims to simplify car insurance and offer a less complicated process for getting a quote and buying car insurance online than other companies. The company does seem to make the selection process rather easy; however, this seems to be the least persuasive hook of the three. In fact, one can argue that with something as serious as car insurance, people want a little more sophistication than Esurance offers.
*Since Geico already won best rates, Progressive’s ‘Name Your Price’ tool is probably the best special feature offered by any of the companies.
Which Company Offers The Best Online Platform?
A digital direct-buy insurance company’s website platform is very important because this is how they distribute their product to the customer. Companies that do not offer brick and mortar offices and do most of their business over the internet need to make their internet platform very easy to navigate and suitable to fulfill all of the consumer’s needs.
All three companies offer a nice website that is easy to navigate and allows the consumer to get a quote, purchase insurance, get proof of insurance, file and view a claim, pay their bill, manage their policy and more right from the website. All three of the companies have a mobile app that you can download in order to manage your policy as well.
Although it may be slightly difficult to distinguish between the quality of the websites, Geico’s website is more professional looking and easier to navigate and find all of the information that you need. The menus that you need to access are at the top of the screen and very easy to find. Furthermore, the portal for you to log in to your account is prominently displayed on the right side of the homepage.
What Company Offers The Best Other Insurance?
Each of the three companies, Geico, Progressive, and Esurance offer more than just car insurance. From these companies you can buy insurance for your home, renters insurance and more. You can even bundle your coverage to save on both premiums. So, the question is, what company offers the best other insurance coverage options?
In addition to auto insurance, Geico offers homeowners insurance that insures against property damage, personal liability, and jewelry. The company also offers renters, condo, mobile home, landlord and flood insurance rounding out its property offerings. Geico also offers business insurance which includes business owners insurance, general liability insurance, professional liability insurance, workers’ compensation, commercial auto, and rideshare. Moreover, Geico also provides umbrella insurance, life insurance, travel insurance overseas insurance, identity protection, pet insurance and jewelry insurance. Thus, you truly can take care of all of your insurance needs from Geico. Geico had less than the median number of complaints according to the National Association of Insurance Commissioners for its homeowners insurance. The company also received four out of five stars by J.D. Power for claims satisfaction.
Progressive insures all types of vehicles including traditional and recreational. The company insures ATVs, boats, classic cars, golf carts, motorcycles, RVs and trailers, segways, and snowmobiles. You can also secure home and property insurance from the company which includes condo, flood, homeowners, homeshare, mobile home, and renters insurance. Moreover, the company offers a number of other types of insurance products and services to its customers which includes business insurance, commercial insurance, health insurance, a car shopping service, home financing, home refinancing, home security, home warranty, ID theft, life insurance, Mexico Auto insurance, personal loans, pet insurance, travel insurance, umbrella insurance and wedding and event planning. Progressive has the lowest complaint rating of all three companies according to the National Association of Insurance Commissioners. However, the company does not have a rating specifically for property insurance.
Similar to the other two companies, Esurance offers a number of forms of insurance. The company insures motorcycles, ATVs, boats, RVs, travel trailers, snowmobiles, scoters, golf carts, and segways. The other forms of insurance that this company offers includes life insurance, commercial auto insurance, health insurance, Mexican auto insurance, umbrella insurance, business insurance, pet insurance, flood insurance, classic vehicle insurance and flood insurance. According to the National Association of Insurance Commissioners, Esurance has twice the median number of complaints than the average home insurance company its size.
The Final Word
All three of these companies, Geico, Progressive, and Esurance are very reputable companies from which you can purchase auto insurance and more. Esurance, however, is a newer and smaller company which often has the highest rates and a low level of claims satisfaction. Progressive’s claims satisfaction rating is a little lower even though it does not have many complaints according to the National Association of Insurance Commissioners. Either way, Geico offers the best rates, the best website, great coverage options, and the highest level of claims satisfaction. Thus, unless you want telematics, one thing this company does not have, Geico may be the best selection of the three. For people who already have Progressive or Esurance, however, it may not be worth switching to Geico when these are both quality insurance companies.