About GEICO Insurance Company
The Government Employees Insurance Company (better known as "GEICO") is an American auto insurance company. GEICO is a "wholly-owned subsidiary" of Berkshire Hathaway that as of 2007 provided coverage for more than 13 million motor vehicles owned by more than 12 million policy holders. GEICO offers private passenger automobile insurance in the District of Columbia and all 50 U.S. states.
GEICO generally deals directly with consumers via the telephone and the Internet, freeing up capital that would otherwise be spent on employing insurance agents in the field. The company is now the third largest direct writer of private auto insurance in the United States, and is perhaps best-known for its often humorous advertisements and various mascots.
What Does it Mean to 'Sue' GEICO?
You may be considering legal action against GEICO if you have purchased an insurance policy from the company, or if you have been injured in an accident with a driver who is insured by the company. The insurance industry's business model is reliant on collecting cash from customers through premiums and deductibles and denying customers payment.
If you or a loved one has been injured in an accident and they or the at-fault driver is a GEICO policyholder, it is important to understand typical settlement tactics that these companies often use to devalue injury victims' claims. Insurance companies are in business for profit, and one of the ways these corporations remain profitable is by minimizing the amount of money they pay out for valid personal injury claims.
Insurance companies are notorious for stalling the release of settlement funds until the last possible second. It's a questionable practice used by a majority of insurance companies today because it keeps money in their pocket. Major insurance companies usually have access to tens of billions of dollars and, as is the case with banks, this money isn't liquid. It's invested to increase its profits.
Insurance Settlement Tactics and Strategies
If an insurance company is required to pay a settlement to a policyholder or an injury victim, they will likely hold onto the money as long as legally possible in a leveraged effort to increase their own profits through the interest they earn on their investments.
In addition to delaying payment, most insurance companies will try the following in order to make you accept a lower settlement:
- Include charges with no explanation that require a lot of research and bureacracy to explain.
- Present clients with a very small initial settlement offer, as many policy holders do not realize they do not have to accept the insurance company’s first offer.
- Stretch out negotiations for as long as possible in an effort to frustrate claimants.
If you are injured in an accident with a GEICO policyholder - or if you are a GEICO customer yourself - you may quickly realize that the insurance company's representatives are employing some of the confusing and frustrating tactics mentioned above. It is very important for accident victims to understand their legal rights after an accident and use that information to protect themselves during the negotiation process.
Naturally, insurance companies are likely to fight harder when there is a significant amount of money at stake in a personal injury claim. Insurance adjusters understand that most accident victims have a limited understanding of the legal process and their own individual rights after an accident, and will use that to their advantage during the negotiation process.