GEICO and Allstate Seek Double-Digit Auto Insurance Rate Hikes in Multiple States

GEICO filed for a 26-percent auto insurance rate increase in New Jersey in late September 2021, while Allstate filed for a 29-percent increase in the same state—among the more aggressive filings across the states where both carriers sought regulatory approval.

Michael Barry, chief communications officer of the Insurance Information Institute, attributed the requests to carriers trying to make up for rate levels effectively frozen during the pandemic, inflation in parts and labor costs, and the normalization of driving volumes and claim frequencies as pandemic restrictions lifted. Insurers also cited the increasing cost of repairing and replacing components on vehicles equipped with advanced driver assistance systems.

For auto glass shops, rising insurance premiums carry a double-edged implication. In the short term, rate hikes rarely translate immediately into higher glass claim reimbursements—carriers typically use the additional premium revenue to shore up underwriting margins rather than to raise schedule rates for specific repairs. Shops that already experienced downward pressure on NAGS-based reimbursements during the pandemic-era rate environment were unlikely to see immediate relief.

The longer-term dynamic is more complex. If insurers argue before state regulators that ADAS-related repair costs are a primary driver of rate requests, they implicitly acknowledge the legitimacy of higher glass-and-calibration billing. Shops that have already adopted calibration into their service workflows—and that document calibration costs separately on invoices—may find that regulatory filings by carriers create a precedent supporting fair reimbursement for the full scope of ADAS-related glass repair.

GEICO's rate situation in 2021 was also complicated by litigation. A federal judge earlier in the year had ruled that GEICO must face a proposed class-action lawsuit alleging it overcharged customers for auto insurance during the pandemic period when driving dropped sharply. The coexistence of that litigation with aggressive rate-increase filings in multiple states illustrated the difficult financial position of major personal-lines carriers in 2021.

Shops that track their insurer relationships closely should view this period—late 2021 into 2022—as a likely inflection point for reimbursement negotiations. Carriers under pressure to justify rate increases to regulators become more data-sensitive, and shops that can demonstrate the real-world cost of a complete, calibrated glass repair are in a stronger position to support fair scheduling discussions with insurance partners.