Finding cheap car insurance can sometimes be time consuming and even frustrating. As consumers, we’re constantly bombarded by car insurance advertisements and it can be difficult to make an informed decision.
Two of the larger car insurance companies in the U.S. are GEICO and State Farm. GEICO is well known for it’s catchy, somewhat quirky ads, and State Farm is well known for being a large multi-line insurance company. GEICO and State Farm sell car insurance in two slightly different ways. GEICO sells car insurance direct to consumers via it’s website or over the phone. State Farm on the other hand, relies on it’s network of captive agents to serve the needs of communities.
How do these two approaches differ? GEICO claims to “cut out the middleman”, which is basically a reference to the insurance agent. GEICO wants you to believe that by simply buying online or direct from GEICO over the phone, you are immediately saving what would normally be paid to insurance agents as commission.
This is great for advertising, but not necessarily accurate. GEICO’s rates are determined based on the type of consumer they wish to insure. The assumption that rates are automatically 10-15% lower because you are buying direct is not accurate, nor should it be used in comparing rates of different insurance companies.
State Farm sells car insurance through thousands of captive agents, which means those agents can only sell State Farm products. The opposite of a captive agent is an independent agent, which can sell car insurance from many different companies, State Farm not being one of those.
To know if GEICO is cheaper than State Farm, you need to do a comparison quote for each company and compare identical quotes. When quoting your car insurance coverage with State Farm, the agent will more than likely ask to quote your other personal coverages such as your home, RV or umbrella along with your car insurance. You can decline to quote other coverages, but you may be missing a multi-policy discount by doing so.
GEICO also offers other coverages such as homeowners and motorcycle insurance, so make sure you do identical comparison quotes between GEICO and State Farm to make a fair comparison.
To compare the rates of car insurance companies in your area, simply enter your zip code in the form below. Our fast, streamlined quote form will securely send your information to multiple insurance companies and they will battle for your car insurance quotes! In the end, all you need to do is sit back, compare rates, and choose the cheapest car insurance rate for you.