Geico Vs AAA Insurance
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When shopping for a car insurance policy, one of the most important things you need to do is compare insurance rates across various companies. By seeing what each individual company offers, given your circumstances as a policy seeker, you can ensure you’re getting the best possible deal when securing liability coverage.
Two of the biggest players in the auto insurance game? GEICO and AAA.
This article will focus on the great GEICO vs AAA auto insurance debate. We’ll break down cost differences between each one and discuss some other important details to consider as a policyholder before deciding which insurance provider is right for you.
When deciding which car insurance policy to buy, the cost of a given plan is one of the most important determinants in your final decision.
Age Based Rates
According to one study[^1] of nation-wide averages for each company, here’s how the two companies compare, broken down by age of policyholder:
GEICO’s rates are lower in every age category
The biggest differences are in the lowest ages:
GEICO’s average annual rate for teenagers is $3,508
AAA’s average annual rate for teenagers is a whopping $10,256 dollars
Differences taper down at older ages:
GEICO’s average annual rate for elders (60+) is $1,065
AAA’s average annual rate for elders is $2,887 dollars
Drivers aged 20-59 can expect to save between $1,923 to $3,426 dollars a year on their auto insurance policy
GEICO is the cheaper option for all drivers, but the difference is most stark for teens.
Rates by Driver History
Aside from age, another main determinant of auto insurance costs is the history of the insured. That history has two main factors—driving incidents and credit score.
According to the same study, here’s how the companies stack up in terms of driving history:
Again, GEICO rates are lower for drivers of all experiences
The biggest differences exist in the extremes:
Drivers with a reckless driving record can save $3,292 dollars on average with GEICO
Drivers with DUIs can save $2,980 dollars on average with GEICO
And here are the differences between GEICO and AAA based on the driver’s credit:
Once again, GEICO is cheaper regardless of credit score
The difference in annual insurance premium costs is most drastic at the lowest credit levels:
Drivers with very poor credit save an average of $4,518 dollars with GEICO
Annual premiums are most similar for drivers with excellent credit:
AAA average rates are just $1,750 dollars more for credit scores of 800-850
Based on these figures, GEICO is the more affordable auto insurer for drivers with much poorer credit or spottier driving histories.
Variance Across the Country
Depending on where you are in the US, you can expect to pay drastically higher or lower prices for auto insurance coverage. Differences in state-required minimum protections, such as Michigan or Florida no fault laws, create differences that translate to much higher (or lower) premiums.
For example, according to a Business Insider survey of auto insurance prices by state, drivers in Idaho can pay as little as $680 dollars annually. However, drivers in Michigan can pay up to $8,723 dollars per year. The average rate across the US is $1,566 dollars annually.
Those differences account for anomalies, such as places where nation-wide trends don’t hold.
Unique Southwest Rates
While prices for GEICO are generally lower across a number of factors, there are exceptions. Namely: auto insurance rates in the southwest of the country buck some of the trends established above. There, AAA can be cheaper than GEICO.
According to a survey[^2] of insurance prices in California, Arizona, and Nevada, here’s how AAA and GEICO prices stack up, by age:
For drivers aged 18-25 in the southwest:
GEICO’s average annual rate is $2,788 dollars
AAA’s average annual rate is $2,202 dollars
For drivers aged 30-60 in the southwest:
GEICO’s average annual rate is $4,888 dollars
AAA’s average annual rate is $4,324 dollars
For drivers aged 60+ in the southwest:
GEICO’s average annual rate is $4,698 dollars
AAA’s average annual rate is $4,060 dollars
Relative to GEICO, AAA auto insurance is much cheaper in these particular states.
Variance like this is why it’s so important to research each auto insurer’s coverage options diligently. Understanding why insurance costs what it does in a state is key to understanding what’s the best deal.
The Sunshine State
In contrast, let’s return to the example of Florida.
Florida is a great example of where the GEICO vs AAA debate is arguably a non-starter. Because of the high minimum car insurance Florida requires, Floridians pay the fifth highest premiums across the nation.
And while GEICO is one of the more affordable options available in Florida, AAA is not. According to one study[^3], GEICO is one of only a handful of insurers that offers rates below Florida’s average for minimum and full coverage:
Florida average annual premiums:
$2,050 dollars for minimum coverage
$3,125 dollars for full coverage
GEICO average annual premiums:
$984 dollars for minimum coverage
$2,221 dollars for full coverage
Even the cheapest car insurance in Florida is still relatively expensive. But it’s worth noting that AAA insurance is nowhere to be found on the list of affordable options in Florida.
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Business Insider. The Average Cost of Car Insurance in the US. https://www.businessinsider.com/personal-finance/average-cost-of-car-insurance
ValuePenguin. AAA vs. GEICO: Auto Insurance Comparison. https://www.valuepenguin.com/compare-aaa-vs-geico-car-insurance
ValuePenguin. Who Has the Best Car Insurance Quotes in Florida? (2020). https://www.valuepenguin.com/cheap-car-insurance-florida-study
The Zebra. GEICO vs. Auto Club (AAA) insurance. https://www.thezebra.com/insurance-companies/geico-vs-aaa/
[^1]: The Zebra. GEICO vs. Auto Club (AAA) insurance. https://www.thezebra.com/insurance-companies/geico-vs-aaa/
[^2]: ValuePenguin. AAA vs. GEICO: Auto Insurance Comparison. https://www.valuepenguin.com/compare-aaa-vs-geico-car-insurance
[^3]: ValuePenguin. Who Has the Best Car Insurance Quotes in Florida? (2020). https://www.valuepenguin.com/cheap-car-insurance-florida-study