After the contract was signed, mistakes made by a fibbing Geico agent resulted in Ana’s car insurance shooting up over $1,000 a year. No wonder they have a caveman a mascot, their customer service is prehistoric. Here’s her story… UPDATE: Commenters point out that GEICO did nothing illegal, this all the usual chain of events in getting insurance. Either the first Geico rep wasn’t as upfront as they should have been about how locked in the rates were, or the consumer misunderstood them, but everything else proceeded pretty much as normal. In other news, insurance companies suck.
I would really like for someone higher up in Geico to know about this case. My husband and I acquired a new car and traded in the old one. We were recommended to switch to Geico to have full coverage and a great rate as we were signing the papers to buy the car. So we call. We get a great quote over the phone after explaining all the necessary information, including the claim we had which happened middle 2005 (minor parking lot accident). We are quoted $182/month or around $1,089 per six months, and we need a downpayment of $366, so we pay $366 it on the spot to get the policy, such a great deal! We wanted it. All of a sudden the sales rep seemed nervous and put us on hold for about 20-30 min. (off and on stopping to say “are you still holding”… of course, we need the papers to be done). Finally he comes back and said “Because of the 2005 claim, the system was changing to a higher rate, so I fixed it, so we can keep you guys at the same rate I just quoted you”. What a nice guy!……Next day or so I get an e-mail to go to Geico.com and sign some form electronically. I try but I am directed to call customer service. I call and they say that my policy is still going through underwriting, but nothing will be changed, though he sounded uncertain and put me on hold for a while… then he confirms that I most likely have coverage since the day after I bought the policy after it goes through reviewing (I am confused but I trusted him, I mean Geico should be pretty good). “Wait 24-72 hours and try going online again”. I felt like he really wanted to finish the conversation as soon as possible after he saw my file.
A few days later I come back and try to sign papers at Geico.com. Same story, the website can’t find my info. I called customer service again and they told me that my effective day was in fact not until next month (which means, I did NOT have insurance until one MONTH after buying the policy!!!!) Even though I had receive apparently “fake” insurance cards saying I was covered already. She said it was a mistake and they would fix it because I was supposed to be covered since the time I bought the policy (and this is what I was told by the person who charged the $366). She said “Wait 24-48 hours and try signing up online again”. So…
Three days later, I finally got through the website… to find out that my rate has increased by a decent chunk, next payment shows as $315, then like 270, etc. and the overall 6 months has increased about almost $400. I called customer service a third time, to be explained why. After going in circles for 30 minutes he finally figured out and said “It’s because of the accident that happened in 2005″ (we talked about that before the “nice” guy gave us the initial quote!!!!). I said that it was definitely not what I was quoted, that great rate that made me sign up. He said he understood …but that there was nothing to do “this does not usually happens, sorry”. He transfered me to a local Florida agent, who pretty much apologized to hear that I had been lied to, that I had signed up and paid for a quote that’s not true anymore and it was their mistake but it was not going to change, there was nothing to do about it. I felt that I was continuously told “I apologize we screwed you up, but that’s how it is now (we changed behind you back since you already paid)”.
So in my desperation to get a lower rate (closer to what I was initially quoted) this Florida agent proposed to increase my deductibles here and there. So collision deductible went from $500 to $1000, and injury went from $0 to $500 (which only helped $76 down the six months), new final quote: $191/month. I don’t have time to keep shopping insurance, switching (as I was recommended by one of the cust, service reps), might as well keep rolling.
Wow.
Thank you,
Ana L.
Even if we say the original GEICO agent was just plain incompetent and made a mistake, the result is the same. Ana and her husband signed a contract for one rate and then got charged another. Even in the end you might say, well, they got around the same monthly rate, $191 vs $182, their deductibles shot up. It’s like fighting over bedsheets in the night. Even worse than the changed rates and the dysfunctional customer service, thanks to Geico’s messup, Ana and here husband were driving around for a month without insurance coverage. That could have landed them in serious trouble if they got in an accident. I say keep shopping around Ana. Check out and see what Progressive has to offer you.
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I insure two cars with State Farm for about $120 a month. Discounts for accident-free, multi-line and multi-coverage (ie, more than one car + homeowners + personal property) They’ve always been great.
It’s State Farm Mutual so policy holders are part owners. I’ve gotten back a check each year for about $50 labeled “dividends.”
Side plug for personal property insurance – I insure my five computers this way for about $30 per year – no deductible. Who needs Best Buy’s extended warranty?
GEICO should be nominated for the most evil company.
I dealt with them ONCE.
Walked into a Geico office in Moreno Valley, Ca. A woman tossed some paperwork toward me and said “here, fill this out”. I walked out instead and will never do business with them, even if they manage the best rate which is HIGHLY doubtful.
I went to Progressive, who insures my Motorcycle, they showed a better rate at another company so I went with that company for my car insurance. Of course Geico wasn’t on the list at all. No other company has beat their rate for my motorcycle though at under $100 a year.
The problem is you tried to do too much at once. I see many people try to change their insurance when they buy a car. Add the car onto your existing policy and then shop. Never cancel your existing policy until you have documentation from the carrier of the price. Your responsibility is to protect yourself, be prudent.
Wait, if customer service has been getting worse and worse, wouldn’t prehistoric customer service be many times BETTER than what we get today?
So Geico isn’t prehistoric, they’re ahead of their time.
I always love the commercials which say, “Customer x saved y dollars by switching to us, in fact in average costumers that switch to us pay z less dollars the our competitors!”
Well of course customers that switch pay less, otherwise they wouldn’t switch to you! But that has no bearing on the experience that the person watching the commercial will have.
@Buran: I live in upstate NY, and I go thru New York Central Mutual. I have a 2002 Saturn Vue with full everything, 50/100K, $500 deductible, and a mint condition 97 Ford F-150 fully loaded ext cab with liability and comp on it, and my YEARLY rate is $1100 for both vehicles. P.S.- I’m only 25, with a spotless driving record
Anyone in upstate NY with a good driving record, check them out!
and P.S. again… most companies look at your credit report, you could have a squeaky clean license, no lapses in coverage… yet if your credit is junk, your rates go UP.
For everyone saying something along the lines of “Yay for State Farm!”… they suck if you actually have a claim.
A friend of my husband’s sister hit my husband’s parked car. They had State Farm and it was a mess trying to get them to actually get the work done. They even ended up putting down that the accident was my husband’s fault (yeah, if parking your car legally means that it’s your fault when someone hits it). I don’t know how they treat their own customers, but they were very unprofessional about taking care of getting our car fixed. Because of that dealing with them, we won’t ever be giving them our money.
@MPHinPgh: You’d be surprised at how cheap they are. I was quoted nearly $2400 a year from most insurance companies (Allstate, Progressive, GEICO, etc) for carrying the basic state minimums. USAA offered me insurance at 5x the state minimum for $1800 a year.
That was back when I was 18, now at 25 I’m paying about $700 a year, but that’s also because my car is so old I don’t carry collision.
@highmodulus: I second that (bundling Auto with your Homeowners). I’m also with State Farm.
The last time I did some comparison shopping, the major companies (Geico Progressive, Allstate) couldn’t come close enough to matching the price with the multi-policy discount applied. The only company that could was one I had never heard of before, and their price was still higher than the additional Safe Driver Discounts State Farm applied to my policy.
I dunno why, but everywhere else I got a quote gave me approximately $1200 for six months for full coverage. Geico is currently giving me about $670 for six months of the same full coverage.
Geico tried to use that as a selling point to me one time, with the idea that the quote that I had gotten from the other company that I was coming to them with would probably end up being way more than I was being told, and so I should go with Geico instead. Although I understand that quotes aren’t definite things, why would I trust that they would be any more able to give me the definite amount than some other company? I ended up going with the other company, and actually getting the initially described rate.
I wish the Consumerist’s writers knew what they were talking about.
@samurailynn, State Farm claims are actually pretty good, one of the best in the business. Mistakes happen.
And frankly, I’d be happy if my insurance company made most of their mistakes on the claims of people who are claiming against me.
Something similar happened to me. My parents were driving a car I inherited to me in NC. Before they left, I checked with GEICO to see how much my rate would go up for this second vehicle. I wanted to make sure I could afford it with full coverage. They quoted me a price that seemed reasonable. (It has been so long, I don’t remember what it was. I think it went up about $100 a month) Once the new vehicle arrived, I called to update the insurance plan. They stated that they did not realize I had only been driving for a few years, and that my original quote was for a more experienced driver. Odd, I thought, since that should be one of the first things they look for when giving a quote. They raised my 6 month rate by about $1500. By the end of the day, I was insured by a different agency at a better rate.
Ugh. This is NOT bait and switch – this is a case of an embarrassed Geico rep and and uneducated consumer.
NO insurance quote is firm until you have undergone underwriting. Home, renter’s, auto, health, life – ALL of them go through a process called “underwriting” and that does NOT happen overnight. 48-72 hours sounds about right.
The Geico rep should have informed Ana that the rate quote was preliminary, non-binding, and contingent on underwriting (although they are not required to say that.)
What chaps my ass is that stuff like this isn’t taught in schools. EVERYONE has to buy insurance at some point in their life. It’s not fun, it’s not easy, but it’s universal – and you need to know what you’re doing.
Would Ana have bought a big HDTV without first finding out about connections, formats, and display types? Probably not. However, people wing through an insurance contract (an expensive, long-term contract!) like they’re buying a pizza! Insane.
I know, I know, the Geico commercials have a lot to do with that – all talking about easy instant quotes, etc.
Regardless, Geico actually did nothing wrong here, and I’m amazed that so many people are flabbergasted at the newfangled concept of underwriting an insurance contract.
Consumerist, Ana and her husband did not sign a contract. They got a quote, put down a deposit, and the insurance company actually initiated coverage before a contract was signed out of good faith. They’ll do that.
Here’s another brainblower for you guys, but take it to heart. Even after the policy is underwritten and a contract signed, you’re not out of the woods yet.
Insurance companies have a 60 day grace period from contract initiation, in most states (and this is part of the contract), in which they can cancel you for any reason. It’s rare, but it does happen.
So, the prudent thing to do with car insurance actually is to buy your new policy, wait 60 days, then cancel the other policy retroactively. (Yes, you can do that too.)
You’ll pay double for 2 months, but you’ll get the double-coverage premiums from the old company back (it’s the law) and you won’t risk being uninsured after an administrative cancellation, which can screw you even further.
@samurailynn:
I’ve had a couple of claims through state farm and I’ve been nothing but pleased with my experiences. All I did was tell them where I would be getting my car fixed and they took care of the rest. Granted, in all of my accidents, I was not the guilty party so I never paid out of pocket and never saw my rates go up.
@MPHinPgh: State Farm was easy with this. I told them I was buying a new car, and they said that they’d have a temp card ready in their office for me to pick up, that they could have the policy take effect the day I picked up the car, my old one would drop that day as well (it went to my dad), and they even explained to me how they were arranging it so that I would keep my long-term discount. It was absolutely NO hassle.
Maybe you and I just got good agents? I don’t know how typical the ease is.
@Buran: Same experience here Buran. Called from the dealership while they were doing the paperwork on my new car- gave them the details over the phone and had the updated cards sent in no time.
I have heard good things about USAA too, if you are eligible.
The information GEICO discovered materially changed the circumstances. The agent committed a fraud upon GEICO.
However, if GEICO cashed the check, or accepted cash, or otherwise debited the enrollee’s bank account, the enrollee was covered. Then, when GEICO discovered the fraud, they terminated the contract and so notified the OP.
In Georgia, when I bought a new car, I was covered the instant my verbal agreement with the third-party agent occurred. It was subject to later underwriting, but until and unless the terms needed modification, I was covered.
Folks, it’s the agents like this turd who cost us all. In my opinion, we sheep who willingly go along when we know, or should know, we are gaming the system, are every bit as culpable. I make no specific representation as to the OP. But I have seen countless instances where “adults” accept more change than they are due, or otherwise take advantage. These fools are no better than any Countrywide or ENRON officer. Think about it.
I got baited and switched by GEICO also. Got an online quote which was very competitive, signed up, and when I got the actual bill they had LOWERED the rate by about 20%! Nice! I’ve got 3 cars, wife and 2 teen drivers in NJ and pay just over $2,100/YEAR for full coverage (collision and $250K/$500K liability.) NJ sucks for auto insurance, but that’s the price we pay for the good life
Don’t know about other states, but here in NJ if you want to switch insurance companies, you sign up with a new company, cancel the old one, and get a pro-rated refund. If the OP felt ripped off, she should have found a new company and punted GEICO.
BTW, I’ve been pleased with GEICO’s claims service. Had a couple of comprehensive claims which were handled online within 10 min. Both were windshield claims and GEICO arranged the repair (at my home, at a time of my choosing) and done professionally within a day or two.
Wow, I never thought this would make it up. As the husband in this story, I would like to add my two cents…
When we signed up, we disclosed the accident that “changed our policy” to the rep. I am not sure what he “fixed” in our plan, but it sure screwed everything up.
So today Ana got a phone call from Geico. They claim that there was a confusion and that the disclosed accident was not one I was at fault and there was another one a month later that I was at fault. Number one, why would that change anything? I would still only be at fault for one accident. Number two, I was not involved with two accidents in the timeframe they claim there was a confusion about. Just the one.
The whole thing is a mess. Yes, this is dealing with insurance companies, but we did pay for our plan that first day, just to find out weeks later that we not only never had coverage that whole time and our insurance cards that THEY MAILED US were apparently fake, but that our insurance was well over $100 a month more than the original quote that we signed up for.
Oh, and for reference, insurance in South Florida (if not all of Florida) is incredibly expensive. And it is a no-fault state. And they require personal injury protection as well.
Oh happy days.
Thank you for posting this. We still have hopes of working this out.
Dan
@graffiksguru: I have had Geico for about 6 years now and have never had a problem with them. I’ve had the best rates with them, and great customer service.
Insurance can seem overpriced, but how do you think $10,000 claims are paid out?
One thing that GEICO and other look a like companies that advertise heavily won’t tell you is that if you move to save,you had better not have an accident. That’s when they will drop you like a hot rock.The reason that they advertise lower rates is that they have built a business model based on low claims payouts:Lower risk customers that don’t file many claims. If you have an accident with them,it’s so long,been nice knowing you and then you find it harder to get insurance somewhere else (and you are up against a deadline to obtain coverage to boot). Far better to stick with a company that wants to keep your business and will “forgive” an accident or two. You may pay more or you may pay less,but if you don’t have all the time in the world to futz around with car insurance,why knock yourself out , (and risk losing coverage)for a few lousy bucks?
Besides,I don’t know how GEICO could possibly have that much lower rates with all of the advertising that they buy. Those ads cost BIG money and you can bet that somebody besides them will end up paying for it.
@workingonyourinvoice:
hey thanks for the suggestion!!! What I was paying with progressive for 6 months, I’m now paying Amica for 1 year, WITH *BETTER* COVERAGE! (*preys his out of state license tickets have fallen off!*)
I live in Central Florida and have Geico insurance on my Civic. I now pay $219 every six months for liability of $100,000/200,000/100,000, comprehensive with $200 deductible, and PIP (Florida is a no-fault state) of 10,000. No collision. These rates include a recent decrease in premium for being claim-free for 5 years. Before Geico, I had Progressive and their rates were much higher. FWIW, I know Geico relies heavily on credit scores, and mine are excellent. Geico also adjusts premiums based on your educational background and occupation (I was asked mine when I signed up and was told upfront this would be a factor in my premium.)
Just do everything online so you don’t have to deal with people. I signed up with Geico within the year and it was effortless. My rate even dropped around $100 when it was time to renew…
@workingonyourinvoice:
Got my policy with amica yesterday, can’t thank you enough, $660/year for full coverage FTW! EVEN WITH A SPEEDING TICKET!