GEICO\u2019s promise to save 15% or more on auto insurance might come up a little short later this year after the property\/casualty giant announced plans to raise premium prices.<\/p>\n
The move comes after GEICO, well known for its gargantuan $1.18 billion advertising budget, saw its underwriting profit tank by $193 million to settle at $160 million. The loss was the result of increases in both claims frequency and severity; the insurer\u2019s loss ratio increased to 80.1 last quarter, up from 75.8 during the same period last year.<\/p>\n
Loss and loss adjustment expenses were up 16.6%, while underwriting expenses increased 9.5%.<\/p>\n
\u201cAs a result,\u201d the company said in its SEC filing, \u201cwe are implementing premium increases as needed.\u201d<\/p>\n
GEICO was quick to dismiss any notion that it had been inadequately pricing risk, however.<\/p>\n
\u201cThe automobile insurance business is highly competitive in the areas of price and services. Some insurance companies may exacerbate price competition by selling their products for a period of time at less than adequate rates,\u201d GEICO said in its 2014 filing. \u201cGEICO will not knowingly follow that strategy.\u201d<\/p>\n
Despite its underwriting losses, GEICO was able to boost its premiums written by 10.2% to $5.886 million, while voluntary policies in-force have increased by 39% over the past five years.<\/p>\n
GEICO credits its status to \u201can aggressive advertising campaign and competitive rates.\u201d The insurer is currently the second largest auto insurer in the country, behind State Farm, with a market share of about 10.8%.<\/p>\n
The top five auto insurers in the country claim a total of 52% of the market share in terms of premium volume, according to 2013 rankings by SNL Financial.<\/p>\n
GEICO has not yet revealed estimates of its intended premium increases, nor when it plans to introduce them.<\/p>\n
Source: Insurance Business America<\/p>\n","protected":false},"excerpt":{"rendered":"
GEICO\u2019s promise to save 15% or more on auto insurance might come up a little short later this year after the property\/casualty giant announced plans to raise premium prices. The move comes after GEICO, well known for its gargantuan $1.18 billion advertising budget, saw its underwriting profit tank by $193 million to settle at $160 million. The loss was the<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[3,4,5,7],"tags":[111,124,11,48],"class_list":["post-566","post","type-post","status-publish","format-standard","hentry","category-businessinurance","category-carinsurance","category-cheapinsurance","category-insuranceonline","tag-accident-insurance","tag-at-home-business-insurance","tag-auto-insurance","tag-auto-quotes-for-insurance"],"_links":{"self":[{"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/posts\/566","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/comments?post=566"}],"version-history":[{"count":1,"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/posts\/566\/revisions"}],"predecessor-version":[{"id":567,"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/posts\/566\/revisions\/567"}],"wp:attachment":[{"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/media?parent=566"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/categories?post=566"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.mvragency.com\/blog\/wp-json\/wp\/v2\/tags?post=566"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}