Coronavirus: Geico offering $2.5 billion in credits to auto insurance customers

Coronavirus - Geico joins other insurance companies offering credits to customers

The gecko is ready to offer discounts to its automobile insurance customers.

Insurance giant Geico announced Tuesday it will offer approximately $2.5 billion of credits to its 19 million auto and motorcycle policyholders whose policies come up for renewal this year between Tuesday and Oct. 7, the company said in a statement and in a tweet.

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That works out to a 15% credit of an insured customer’s total premium, or about $150 per automobile policy and $30 per motorcycle plan, Geico said in a statement.

The Geico Giveback will also apply to policies purchased between Tuesday and Oct. 7, the company said in a statement.

Geico’s move comes after similar actions by Allstate, American Family Insurance and Liberty Mutual Insurance. Allstate announced Monday it was returning more than $600 million in auto insurance premiums to customers, American Family Insurance said it was refunding approximately $200 million to its customers, while Liberty Mutual announced refunds totaling about $250 million.

The companies cited fewer claims as people are driving less because of stay-at-home orders issued around the country.

“The ongoing crisis has widespread effects that will linger,” Geico Chief Executive Todd Combs said in a statement. “Our customers have been loyal, and we are committed to doing all we can to help them.”

Geico is owned by billionaire Warren Buffett’s Berkshire Hathaway Inc. In its tweet, Geico said customers to not have to take action to receive their credit. Geico said last month it would halt cancellation of coverage because of nonpayments through April 30.

“This ongoing crisis has widespread effects that will linger,” Combs said in the statement. “That is why we wanted to give this credit for at least six months.”

State Farm and Progressive are also reviewing their premium practices, CNBC reported.

Geico, owned by Buffett’s Berkshire Hathaway Inc., will provide a 15% credit to its auto and motorcycle customers through Oct. 7.
Geico, owned by Buffett’s Berkshire Hathaway Inc., will provide a 15% credit to its auto and motorcycle customers through Oct. 7. (Charles Dharapak/Associated Press)