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- GEICO must provide more than $10.5 mn in refunds to New Jersey auto insurance policyholders following a state regulatory examination.
- Investigators identified four violations affecting more than 15,000 policyholders, including excessive premiums, improper cancellations and inadequate consumer disclosures.
- New Jersey regulators imposed a $1.2 mn penalty on GEICO and its affiliates, while the insurer began issuing refunds during the examination process.
GEICO must refund more than $10.5 mn to New Jersey auto insurance policyholders after state regulators identified improper business practices affecting more than 15,000 customers.
The New Jersey Department of Banking and Insurance (DOBI) uncovered the violations during a market conduct examination launched in September 2024 following numerous consumer complaints about the insurer.
The investigation identified problems involving premium charges, policy cancellations, nonrenewal notices and disclosures to customers whose vehicles had been declared total losses.
Regulators also imposed a $1.2 mn penalty on GEICO and its affiliates.
New Jersey regulators identify four GEICO insurance violations
The market conduct examination documented four categories of violations involving GEICO’s auto insurance operations.
Investigators found that the company charged some policyholders premiums exceeding state-approved rates and canceled certain insurance policies for improper reasons.
GEICO also failed to include legally required language in policy nonrenewal notices.
A fourth violation involved inadequate disclosures to policyholders whose vehicles had been declared total losses. The insurer did not properly inform those customers of their rights when they elected to retain their vehicles after receiving insurance settlements.
The findings affected more than 15,000 New Jersey auto insurance policyholders.
GEICO begins issuing refunds following regulatory examination
According to the Department of Banking and Insurance, GEICO voluntarily began issuing refunds while the regulatory review was still underway.
The company must return more than $10.5 mn to affected customers, in addition to the $1.2 mn penalty assessed against GEICO and its affiliates.
Consumer protection is at the heart of our mission here at the Department of Banking and Insurance, and we will continue to work aggressively to end bad business practices that are harming New Jersey consumers.
Susan Ochs, Acting Commissioner
“This penalty settlement and the corresponding refunds to policyholders demonstrate our commitment to fostering the trusted, accountable, healthy marketplace that will best serve New Jerseyans,” Susan Ochs said.
The refunds and financial penalty follow the state’s examination of GEICO’s compliance with New Jersey insurance requirements, including approved premium rates, cancellation procedures and mandatory policyholder disclosures.
