GEICO

GEICO=

=The Government Employees Insurance Company, usually known by the acronym 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 10 million motor vehicles owned by more than 9 million policy holders. GEICO writes private passenger automobile insurance in the District of Columbia and in all 50 U.S. states. The company is notable for its television advertising, with several prominent campaigns running simultaneously in national markets. Its mascot is a gecko that originally had an American accent but for marketing reasons was changed to a Cockney accent.

History

GEICO was founded in 1936 by Leo Goodwin and his wife Lillian to provide auto insurance directly to federal government employees and their families.[2] GEICO's original business model was predicated on the assumption that federal employees as a group would constitute a less risky and more financially stable pool of insureds, as opposed to the general public. Despite the presence of the word "government" in its name, GEICO has always been a private corporation.

An important figure in GEICO's history is David Lloyd Kreeger, who became president of the company in 1964 and helped steer it into a major insurance enterprise. In 1948, he formed a group of investors who bought into GEICO. He became senior vice president and general counsel of the company. Six years after becoming president of GEICO in 1964, he was named chairman and chief executive officer. He retained those titles until he retired in 1974. He continued as chairman of the executive committee until 1979, when he was named honorary chairman.[3] Intriguingly, the GEICO web site avoids any mention of Kreeger.[2]

In the 1970s, under Kreeger's leadership, GEICO began to insure the general public, after real-time access to computerized driving records became available throughout the United States. In 1996, GEICO became a wholly owned subsidiary of Berkshire Hathaway.

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. As a result, the company is now the 3rd largest direct writer of private auto insurance in the United States.[4]