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UPDATED: Mar 13, 2020
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Comparing auto insurance takes more more than just looking at rates. The cheapest insurer may not be the best choice, and you might find that some companies offer things that others do not. By doing your research in advance, you can determine what the best company is to match the needs of your family.
When it comes to major insurance companies, the differences from one insurer to the next can seem quite small. After all, all companies provide similar policies, and costs can only vary within state-mandated regulations. Nevertheless, some insurers offer better discounts to certain groups of people than others, and customer service can vary from one company to the next.
Two of the better-known insurance companies you may be considering are Geico and Nationwide. Geico is the third largest company by market share in the industry. Nationwide, though smaller, still holds 4.2% of the total market.
Government Employees Insurance Company, or Geico, has been offering policies since 1936. Over the past two decades, it has gained tremendously in popularity thanks to its direct sales model and aggressive marketing campaigns. Geico insures about 10 million vehicles and also provides homeowner and motorcycle policies to consumers.
Geico is perhaps best known for its quirky advertisements and promises of saving money on rates. They do offer several discounts that can lead to cheap rats:
— Equipment discounts for safety features
— Accident free safe driver discount of up to 25%
— Driver’s education and good student discounts
— Military and federal employee discounts
— Multi-policy and multi-car discounts
As with all insurance companies, Geico bases its rates on a driver’s history, gender, marital status, credit history and other factors. The company does tend to charge much higher rates for people with poor credit than other companies do for similar customers, so that is something to be aware of.
Founded in 1926, Nationwide is part of a large financial organization that began as Farm Bureau Mutual. In addition to insurance, Nationwide provides a large number of financial services like investments and asset management. It’s also the parent company to auto insurance subsidiaries Allied and Titan, which service smaller niches of auto owners.
Nationwide offers several discount programs:
— A multi-policy and multi-car discount
— A family plan discount of up to 25% if you insure the entire family
— An accident-free safe driver discount with vanishing deductibles
— A farm bureau discount if you join a local farm bureau
— Paperless billing discounts
— Discounts for affiliate memberships in partnered companies
Subsidiaries of Nationwide like Farm Bureau, Titan and Allied may have different discounts and offer slightly different rates and features. Depending on your needs, one of them may be a better match than Nationwide itself.
Geico vs Nationwide
In terms of customer service, Geico comes out as a clear winner according to JD Powers and Associates ranking for 2011 earning a four out of five, and its Smart Rating for customer service is a five out of five, with an overall Smart rating of 89. Nationwide, on the other hand, scored just three for five stars with JD Powers and has an overall Smart rating of 64.
The two companies are, however, ranked on equal footing in terms of financial strength. Both have satisfactory credit ratings through AM Best.
Which is Better?
There is no such thing as a perfect insurance company, and some companies are better at certain things than others. For example, military personnel may get better discounts through Geico, whereas farm workers will probably get better rates through Nationwide. You must also review the customer service and make your choice accordingly. The only way to know for sure whether you’ll like a company is to deal with them, so you should be sure to talk with the customer service department before making your choice.
The best way to decide which insurer to use is to get a number of quotes from different companies and then compare them side by side. By comparing both rates and customer service across all possible companies, you can pick the best insurer to suit your needs.