Geico owes more than $10.5 million to New Jersey policyholders after state regulators found the insurer charged unapproved rates and improperly canceled policies over a one-year period.

The New Jersey Department of Banking and Insurance (DOBI) announced Oct. 20 that it fined Geico and four affiliates $1.2 million following a market conduct examination, as first reported by the New Jersey Monitor. The investigation found what the department called a "systematic pattern" of improper business practices affecting more than 15,000 policyholders statewide.

Cherry Hill residents who held Geico auto policies between June 2023 and May 2024 could be among those owed money. The state has not released a geographic breakdown of affected customers.

What investigators found

DOBI's consumer protection office opened its probe in September 2024 after customers complained about underwriting, rating, claims handling and policy cancellations. Investigators examined Geico's activity from June 1, 2023, through May 31, 2024, according to the department's consent order.

The examination cited Geico in four areas: charging rates higher than what the department had approved, canceling policies for improper reasons, omitting required language on notices that could lead to nonrenewal, and failing to inform owners who kept vehicles declared a total loss of their rights.

Geico began refunding overcharged premiums while the investigation was still underway, according to the department. It is unclear whether affected policyholders need to take any action to receive a refund.

Geico responds

Geico spokesman Michael Young told the New Jersey Monitor the company "has already taken steps to address the department's recommendations."

"GEICO remains committed to its customers and to growing in the state and has recently lowered rates in New Jersey," Young told the Monitor.

Geico signed the consent agreement Sept. 28. Acting Commissioner Susan Ochs entered the order Oct. 20. The agreement requires Geico to comply with the department's recommendations and allows DOBI to reexamine the company within 12 months.

Rising rates across New Jersey

The enforcement action comes as car insurance costs climb statewide. In the year investigators began their probe, Geico and its affiliates sought rate increases ranging from 6.8% to 26.3%. The department approved hikes of 6.8% to 19.1%, according to public records data obtained by the New Jersey Monitor.

Ochs said in a statement that her agency works to end practices that harm residents.

How to file a complaint

New Jersey residents with insurance concerns can file a formal complaint online or call the department's consumer hotline at 800-446-7467 or 609-292-7272.