Cavemen, Lizards and Customer Service

You've seen the commercials; we all have. Guys dressed up as cavemen (somehow unchanged and undetected living in the modern day) take offense at being called primitive and stupid, while elsewhere a CGI gecko with a Cockney accent talks about saving people on their auto insurance and even less probable things happen, all with the "15 minutes could save you 15 percent" tag line. Meanwhile, you've probably wondered (as I had) how an insurance company that operates directly over the Internet (without the more traditional offices and agents) would function when faced with an actual claim...

As it happens, GEICO stands for Government Employee Insurance Company, and was in fact founded in 1936 under the concept of selling auto. insurance to government employees. The company's founder believed that these people would make better customers, both in the sense of making fewer claims and also in the sense of defaulting on their payments less often, than the general public. When the statistics finally disproved this belief in the 1970s the company apparently gave up and started selling policies to anyone who could qualify for one...

I first went to GEICO on a referral from another company. I had called Progressive for one of their multi-company rate comparisons, and they told me that GEICO had a better rate than anything they could offer me. This is supposed to impress me with their honesty and candor, and make me want to buy their product regardless of the price differential. This kind of backfired on them; I was impressed, all right, but GEICO was offering the same coverage for half the price...

In itself, this wasn't really surprising; the company has always used the money they save on infrastructure (by having no field offices and almost no field agents, for example) to offer extremely low premiums, and this basic business model works even better in an e-commerce context than it did before the Internet age. Some older customers are put off by the lack of a traditional agent whose name you know (and who, presumably, knows yours), but younger customers (who mainly communicate by email themselves) are less likely to care about traditional marketing efforts like "personalized" form letters on your birthday and so on. The real question is, how do you handle a claim without agents or claims adjusters?

We got the chance to find out when a truck kicked up a huge rock that broke out windshield in Albuquerque on Sunday. Not only was it a claim, but we were 800 miles from our official address and 1400 miles from our new home in Michigan. We called the GEICO service line and explained the situation, but it didn't seem to phase them. They set us up with an appointment at an approved repair shop for the day after we arrived in Lansing, offered to wave the deductible if it turned out to be a repairable break.

It remains to be seen if the repair side will run smoothly; I'll keep you posted. For now, let's just say that while GEICO's marketing may be a bit goofy, their customer service people are not. And if their operations people can live up to this level, then it's no wonder they've taken over so much of their industry...