Geico Joins Rival Insurers in Tracking Drivers

Warren Buffett’s Geico now wants to track drivers, just like some of its biggest competitors do. Geico has launched a telematics offering, called DriveEasy, in certain states, Credit Suisse Group AG analyst Mike Zaremski said in a research note last week.

Source: Bloomberg | Published on August 5, 2019

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A phone app tracks driving habits and gives individuals a score and tips, according to Geico’s website. While Geico has historically offered discounts to drivers for staying accident-free for five years, the app would be more interactive, using the phone to track trips. Rivals including Progressive Corp., which Buffett has called “well-run,” and Allstate Corp. have long used programs to track drivers and encourage better behavior.

Zaremski has previously said that he estimates Progressive’s policies that use telematics, the technology to collect information about driving habits, are 15% to 25% more profitable than the ones that don’t. Geico was expected to introduce its own offering to avoid ending up with the less-profitable clients who other insurers don’t want, he said Tuesday in a note.

A Geico representative didn’t have an immediate comment about the program.