Progressive, Geico, Esurance Homeowners Insurance: Is it a Good Deal?

Have you seen Geico, Esurance, or Progressive insurance ads on TV? The ads promote their auto insurance, but the ads often mention they offer homeowners & renters insurance, too. In fact, one of these insurance companies is heavily promoting a discount for “bundling” home & auto insurance together, to get low insurance rates. However, buying property insurance from these companies can be misleading, and you might be insuring your home with an insurance company you have never heard of, with a poor customer complaint record. This review will give you information, to help you decide if buying home insurance from Progressive, GEICO, or Esurance is a wise decision for you.

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Did you know GEICO & Progressive do not insure homes or apartments? These insurance companies offer vehicle insurance, but when it comes to home insurance & renters insurance, they partner with other insurance companies, and sell another insurance company’s homeowners insurance. You may think you are buying Progressive homeowners insurance, but you really may get IDS Homeowners insurance, or Homesite homeowners insurance, or Travelers homeowners insurance.

Esurance, as of November 2013, has developed its own home & renters insurance policies, which it will start offering in more states this year (as revealed in this article from Insurance Journal: Esurance Hopes Bundling Auto, Home Coverages Will Separate It From Geico). However, many customers seeking home insurance through Esurance have been sold home insurance issued by another insurance company, through the Answer Financial insurance agency, owned by Allstate Insurance (Esurance is also owned by Allstate).

Are you being deceived intentionally? Is this a rip off?

It may be deceptive, but it’s not really a rip off. However, there are a few things you should know, before you buy homeowners or renters insurance from these companies not selling their own property insurance.

1. Why don’t Progressive, Esurance, & Geico have their own homeowners insurance?

Catastrophic losses, such as tornadoes, hurricanes, & wild fires can make homeowners insurance less profitable, and in some years, a money loser for insurance companies. Auto insurance, and insuring other vehicles, such as watercraft, motorcycles, motor homes, etc., is more consistently profitable, so some insurance companies stick to this business. Insurance companies providing homeowners insurance with earthquake coverage, may be bankrupted, if there is a big earthquake (which is supposedly overdue) in the Pacific Northwest, if it is more costly than anticipated. Some insurance companies want to stay away from huge losses from big natural disasters. This is why it is important to choose an homeowners insurance company with a high financial strength rating.

Although they don’t sell their own home & renters insurance, GEICO & Progressive do sell a lot of property insurance to their auto insurance customers. Due to the prominence of GEICO & Progressive in the market place, JD Power is now reviewing and rating the bundling of home and auto insurance with companies like GEICO & Progressive, so I will be writing new reviews of buying home insurance from auto insurers like Esurance, Progressive, & GEICO in the future, analyzing the new JD Power ratings.

2. Be sure to find out which insurance company will be providing your homeowners insurance.

This may vary depending on the state in which you live. Progressive works with IDS (Ameriprise) insurance in some states, and Homesite insurance in others. Progressive is selling you the homeowners insurance, but the company issuing the policy and insuring you, will be settling your claims. You want to check the complaint record for the insurance company insuring your home to make sure you will get good customer service.

Homesite, in particular, does not have a very good complaint record. You can read my reviews here for Homesite insurance & IDS insurance.

Geico, Esurance, & Progressive have changed which insurance companies they use for homeowners insurance in the past, and using different insurance companies to partner with to offer home insurance may change in the future. This won’t effect you after you have purchased your homeowners insurance policy, but you can use my website to research other insurance companies as needed.

When you get homeowners or renters insurance quotes, ask for the exact name of the company underwriting the insurance, and check their complaint information on my website.

Homesite insurance is a smaller insurance company selling homeowners insurance direct to the public. I believe Geico, Esurance, Progressive, and 21st Century, too, before it was purchased by Farmers Insurance, have used or still use Homesite insurance in some states. I have some reservations about Homesite insurance, based on its complaint ratings, and that it is not rated by AM Best.

3. You may get the best price & service by insuring your home or renters insurance & auto insurance with an insurance company offering both home & auto insurance.

Insurance companies offering both auto & home insurance have large discounts on both policies. The discounts can be 10%,15%, 20%, or sometimes 25% on both policies.

Progressive, when I asked them about my auto insurance, said I would get a discount only on my condo insurance I buy from them, with no discount for my auto insurance.

Sometimes, insuring your home and car with different insurance companies make sense. It’s important with homeowners insurance to go with the insurance company having the best coverage for you. This is why I have my condo insurance with one company, and my auto insurance with another company. But for many people, getting the best price and service is by having your auto & home with the same insurance company.