GEICO Employment Assessment Test — Questions and Answers

Question 1: When the tread depth falls below_______, the tires must be replaced.

1.5 inches
6/32 inch
2/32 inch (Correct answer)
½ inch

Correct answer: 2/32 inch

The legal minimum tread depth for tires in most regions is 2/32 of an inch. When tire tread wears down to this level, the tires lose significant traction, especially in wet conditions, and must be replaced to ensure safety and comply with traffic laws.

Question 2: A customer wants to cancel their policy. What is the recommended approach?

Add extra charges to discourage cancellation
Process the cancellation immediately
Understand their reasons, explore solutions to their concerns, and if they still want to cancel, process it professionally (Correct answer)
Refuse to cancel

Correct answer: Understand their reasons, explore solutions to their concerns, and if they still want to cancel, process it professionally

Understanding the reason may reveal a solvable problem (rate, coverage). If cancellation is their decision, handling it professionally maintains goodwill.

Question 3: What is the safest way to handle a tailgater behind you?

Speed up far beyond the limit
Brake sharply to warn them
Wave your arm out the window
Move over and let them pass (Correct answer)

Correct answer: Move over and let them pass

Letting an aggressive tailgater pass removes the risk rather than escalating it.

Question 4: What is the correct procedure when a customer provides inconsistent information?

Politely point out the inconsistencies and ask for clarification to ensure accurate records (Correct answer)
Accept whatever they say
Ignore the inconsistencies
Accuse them of lying

Correct answer: Politely point out the inconsistencies and ask for clarification to ensure accurate records

Diplomatic clarification of inconsistencies protects both the customer and the company while maintaining accurate records.

Question 5: What does 'premium' mean in insurance?

The maximum payout amount
The best coverage available
A type of deductible
The amount paid by the policyholder for insurance coverage, typically monthly or annually (Correct answer)

Correct answer: The amount paid by the policyholder for insurance coverage, typically monthly or annually

The premium is the cost of insurance, paid regularly to maintain coverage. It is determined by factors like risk level, coverage amount, and deductible.

Question 6: What should you do if a customer reports a claim involving a potential injury?

Document all details carefully, advise them to seek medical attention, and follow the company's injury claim protocol (Correct answer)
Tell them injuries are not covered
Minimize the importance of the injury
Transfer them to a different department without taking information

Correct answer: Document all details carefully, advise them to seek medical attention, and follow the company's injury claim protocol

Injury claims require careful documentation, immediate medical attention advice, and proper protocol following to protect both the customer and the company.

Question 7: A system error results in incorrect policy information being sent to a customer. What should you do?

Wait for the customer to call and complain
Blame the IT department
Proactively contact the customer, explain the error, provide correct information, and document the incident (Correct answer)
Hope they do not notice

Correct answer: Proactively contact the customer, explain the error, provide correct information, and document the incident

Proactive communication about errors demonstrates integrity and prevents the customer from making decisions based on incorrect information.

Question 8: What is data privacy's importance in insurance?

Privacy only matters for online accounts
Only IT is responsible for privacy
Insurance handles sensitive personal and financial data requiring strict compliance with privacy laws (Correct answer)
It is not very important

Correct answer: Insurance handles sensitive personal and financial data requiring strict compliance with privacy laws

Insurance companies collect highly sensitive personal, medical, and financial information. Protecting this data is both a legal obligation and a trust requirement.

Question 9: What is the difference between liability and collision coverage?

They are the same
Liability is optional; collision is mandatory
Collision is cheaper
Liability covers damage you cause to others; collision covers damage to your own vehicle from accidents (Correct answer)

Correct answer: Liability covers damage you cause to others; collision covers damage to your own vehicle from accidents

Liability pays for injuries and property damage you cause to others. Collision pays for damage to your own vehicle regardless of fault.

Question 10: Besides auto, GEICO also offers policies for which of the following?

Homeowners and renters insurance (Correct answer)
Pet adoption services
Mobile phone plans
Stock trading

Correct answer: Homeowners and renters insurance

GEICO offers a range of products including homeowners, renters, motorcycle, and umbrella insurance.

Question 11: A policy has a per-occurrence limit of $100,000 and an annual aggregate of $300,000. If three claims of $90,000 each occur, how much will insurance pay total?

$200,000
$90,000
$300,000
$270,000 (Correct answer)

Correct answer: $270,000

Each claim ($90,000) is under the per-occurrence limit ($100,000), so all are covered. Total = $270,000, which is under the aggregate ($300,000).

Question 12: A fleet discount of 10% applies when insuring 3+ vehicles. If each vehicle costs $800/year, what is the total for 4 vehicles with the discount?

$2,400
$3,200
$3,600
$2,880 (Correct answer)

Correct answer: $2,880

4 vehicles × $800 = $3,200. With 10% discount: $3,200 × 0.90 = $2,880.

Question 13: Which of the following amounts is NOT equal to $8,374.50?

$8,374.50
$8,374.50
$8,347.50 (Correct answer)
$8,374.50

Correct answer: $8,347.50

$8,347.50 differs from $8,374.50 because the digits '7' and '4' in the hundreds position are transposed.

Question 14: What is the best approach to learning new insurance products and policies?

Study company materials, attend training sessions, and practice explaining products in simple terms (Correct answer)
Wait until customers ask about them
Rely solely on the computer system for information
Only learn what is relevant to your current role

Correct answer: Study company materials, attend training sessions, and practice explaining products in simple terms

Continuous learning ensures you can confidently and accurately help customers with all available products and services.

Question 15: What is the importance of ethics in professional practice?

Ethics are just about following the law
Ethics only apply to certain professions
Ethics are optional
Ethical practice builds trust, protects clients, maintains professional standards, and ensures long-term career viability (Correct answer)

Correct answer: Ethical practice builds trust, protects clients, maintains professional standards, and ensures long-term career viability

Professional ethics go beyond legal requirements to encompass honesty, integrity, confidentiality, and putting client interests first, which are fundamental to any trusted profession.

Question 16: A customer cannot access their online account. What troubleshooting steps should you follow?

Create a new account for them
Verify their identity, check account status, reset password if needed, and guide through the login process (Correct answer)
Tell them to call tech support
Tell them to try again later

Correct answer: Verify their identity, check account status, reset password if needed, and guide through the login process

Systematic troubleshooting starts with identity verification, then checks the most common issues (password, account status) before escalating.

Question 17: A Geico email states: 'Your renewal quote reflects a 12% surcharge due to a recent at-fault accident.' What is a surcharge in this context?

A fee for changing your coverage level
A refund issued after a claim
An additional charge added to the premium as a penalty (Correct answer)
A discount applied for safe driving

Correct answer: An additional charge added to the premium as a penalty

A surcharge is an extra amount added to an insurance premium, typically because of increased risk such as an at-fault accident.

Question 18: What is uninsured motorist coverage?

Coverage that protects you if you are hit by a driver who has no insurance (Correct answer)
Coverage for when you do not have insurance
Coverage for rental cars only
Coverage that is not required

Correct answer: Coverage that protects you if you are hit by a driver who has no insurance

Uninsured motorist coverage pays for your injuries and damages when the at-fault driver has no insurance or cannot be identified (hit-and-run).

Question 19: A Geico notice reads: 'Your premium has been recalculated due to an adverse driving record.' What does 'adverse' most likely mean here?

Improved
Unfavorable (Correct answer)
Extended
Verified

Correct answer: Unfavorable

'Adverse' means unfavorable or harmful, so an adverse driving record includes tickets, accidents, or violations that increase risk.

Question 20: If a good student discount reduces a premium by 15%, and the original premium is $2,000, what is the new premium?

$1,700 (Correct answer)
$1,500
$300
$1,850

Correct answer: $1,700

15% of $2,000 = $300 discount. New premium = $2,000 - $300 = $1,700.

Question 21: What does 'exclusion' mean in an insurance policy?

A premium discount
A specific condition, event, or circumstance that the policy does not cover (Correct answer)
A type of endorsement
An extra benefit

Correct answer: A specific condition, event, or circumstance that the policy does not cover

Exclusions define what the policy will not pay for. Common exclusions include intentional acts, wear and tear, and war.

Question 22: How should you respond when someone tailgates you?

To convey a message, slam on the brakes
Accelerate the car
Ignore the other vehicle entirely.
Let them pass by moving aside (Correct answer)

Correct answer: Let them pass by moving aside

When someone is tailgating, the safest response is to create more space by moving over or gently slowing down to allow them to pass. This reduces the risk of a rear-end collision and de-escalates a potentially dangerous situation, promoting overall road safety.

Question 23: Which of the following best describes 'proximate cause' in an insurance claim?

The insured's estimated cost of repair
The last event in a chain of events
The date the incident was reported to the insurer
The primary cause that directly leads to a loss (Correct answer)

Correct answer: The primary cause that directly leads to a loss

Proximate cause is the dominant, direct cause that sets in motion the sequence of events resulting in a loss.

Question 24: A customer's premium increased 8% from last year. If they now pay $1,620, what was last year's premium?

$1,550
$1,490.40
$1,500 (Correct answer)
$1,540

Correct answer: $1,500

If 1.08 × last year's premium = $1,620, then last year's premium = $1,620 ÷ 1.08 = $1,500.

Question 25: A customer insists their car damage was caused by a covered peril, but photos show evidence it was caused by normal wear and tear. How should you handle this?

Deny the claim without any explanation
Explain clearly why the damage appears to be wear and tear, which is not a covered peril, and offer to escalate for a second opinion (Correct answer)
Approve the claim to avoid conflict with the customer
Ask the customer to provide their own photos to contradict the evidence

Correct answer: Explain clearly why the damage appears to be wear and tear, which is not a covered peril, and offer to escalate for a second opinion

Transparent communication explaining the basis for a decision, with an offer to escalate, is the professional and fair approach.

Question 26: An agent processes 12 claims per hour. How many claims can they process in a 7.5-hour shift?

96
90 (Correct answer)
75
84

Correct answer: 90

12 claims/hour × 7.5 hours = 90 claims per shift.

Question 27: A customer is upset about a rate increase. What is the BEST approach?

Empathize, explain the factors affecting rates, and review coverage for potential savings (Correct answer)
Offer to cancel their policy
Transfer them immediately
Tell them rates go up for everyone

Correct answer: Empathize, explain the factors affecting rates, and review coverage for potential savings

Empathy combined with education and proactive savings review addresses the emotion and the practical concern.

Question 28: Which discount is GEICO commonly known to offer?

Discount for never paying premiums
Discount for driving without a license
Discount for hiding accidents
Multi-policy (bundling) discount (Correct answer)

Correct answer: Multi-policy (bundling) discount

GEICO commonly offers a multi-policy discount when customers bundle products like auto and homeowners insurance.

Question 29: What is a declarations page?

The page of an insurance policy summarizing key information including coverage, limits, deductibles, and premiums (Correct answer)
A cancellation notice
A political document
A claim form

Correct answer: The page of an insurance policy summarizing key information including coverage, limits, deductibles, and premiums

The declarations page (dec page) is the summary page of a policy containing all critical information at a glance: who, what, when, how much.

Question 30: What is gap insurance?

A type of health insurance
Insurance for parking garages
Coverage that pays the difference between what you owe on a vehicle loan and the vehicle's actual cash value if totaled (Correct answer)
Coverage for gaps in fences

Correct answer: Coverage that pays the difference between what you owe on a vehicle loan and the vehicle's actual cash value if totaled

If your car is totaled and you owe more than it is worth, gap insurance covers the 'gap' between the ACV payout and your loan balance.

Question 31: What does it mean when a Geico letter states your policy has been 'rescinded'?

Your policy has been cancelled and treated as if it never existed (Correct answer)
Your premium has been reduced due to a good driving record
Your coverage has been upgraded to a higher tier
Your policy has been renewed for another term

Correct answer: Your policy has been cancelled and treated as if it never existed

Rescission voids a policy retroactively, often because of fraud or misrepresentation at the time of application.

Question 32: What is the difference between replacement cost and actual cash value?

Replacement cost is always cheaper
Replacement cost pays to replace the item at current prices; actual cash value deducts depreciation (Correct answer)
Actual cash value pays more
They are the same

Correct answer: Replacement cost pays to replace the item at current prices; actual cash value deducts depreciation

Replacement cost covers the full cost to replace an item with a new equivalent. Actual cash value subtracts depreciation, paying less for older items.

Question 33: What is the primary purpose of claims processing in insurance?

To deny as many claims as possible
To evaluate and settle policyholder claims fairly and efficiently according to policy terms (Correct answer)
To delay payments
To increase company profits

Correct answer: To evaluate and settle policyholder claims fairly and efficiently according to policy terms

Claims processing evaluates losses against policy terms to provide fair, timely settlements, which is the core promise of insurance.

Question 34: If comprehensive coverage costs $180/year and collision costs $350/year, what is the total for both per month?

$29.17
$53.00
$44.17 (Correct answer)
$530.00

Correct answer: $44.17

Total annual: $180 + $350 = $530. Monthly: $530 ÷ 12 = $44.17 per month.

Question 35: How should you handle a billing discrepancy reported by a customer?

Dismiss it as a system error
Tell them to pay and dispute later
Transfer to billing without investigating
Review the account history, identify the discrepancy, explain the charges, and correct any errors (Correct answer)

Correct answer: Review the account history, identify the discrepancy, explain the charges, and correct any errors

Investigating the discrepancy thoroughly, explaining what happened, and correcting any errors demonstrates accountability and builds trust.

Question 36: A customer has a $500 deductible and $3,200 in covered damages. How much will insurance pay?

$3,700
$2,700 (Correct answer)
$500
$3,200

Correct answer: $2,700

Insurance pays the covered damages minus the deductible: $3,200 - $500 = $2,700.

Question 37: In an insurance document, 'subrogation' is described as: 'The right of the insurer to pursue a third party that caused an insurance loss to the insured.' What best paraphrases this definition?

The insured's right to switch insurers after a claim
The insurer's right to seek reimbursement from the party responsible for a loss (Correct answer)
The insurer's obligation to pay claims within 30 days
The policyholder's right to dispute a denied claim

Correct answer: The insurer's right to seek reimbursement from the party responsible for a loss

Subrogation allows an insurer to recover money paid on a claim from the at-fault third party.

Question 38: How should you handle a customer who speaks limited English?

Rush through the call
Use simple language, speak clearly at a normal pace, and offer translation services if available (Correct answer)
Transfer them to another agent
Speak louder

Correct answer: Use simple language, speak clearly at a normal pace, and offer translation services if available

Using simple language and offering translation services ensures the customer understands their coverage and options, regardless of language barriers.

Question 39: What is the importance of documentation in professional work?

Documentation provides a record of work done, decisions made, and processes followed, enabling consistency and accountability (Correct answer)
Only managers need to document
It creates unnecessary paperwork
It is only for legal purposes

Correct answer: Documentation provides a record of work done, decisions made, and processes followed, enabling consistency and accountability

Good documentation supports quality control, knowledge transfer, troubleshooting, legal compliance, and continuous improvement.

Question 40: What should you do if your brakes suddenly fail while driving?

Steer into oncoming traffic
Turn off the engine immediately
Pump the brakes and downshift to slow down (Correct answer)
Close your eyes and coast

Correct answer: Pump the brakes and downshift to slow down

Pumping the brakes may restore pressure, and downshifting uses engine braking to slow the car.

Question 41: A policy exclusion clause reads: 'This policy does not cover intentional acts by the insured.' Which situation would fall under this exclusion?

A passenger is injured when the driver runs a red light by mistake
A driver accidentally rear-ends another car
A driver deliberately rams another vehicle during an argument (Correct answer)
A car is damaged in a hailstorm

Correct answer: A driver deliberately rams another vehicle during an argument

Deliberately ramming another vehicle is an intentional act, which exclusion clauses are designed to exclude from coverage.

Question 42: Which word is closest in meaning to 'liable' as used in insurance contexts?

Reimbursed
Exempt
Responsible (Correct answer)
Insured

Correct answer: Responsible

In insurance and legal language, 'liable' means legally responsible for damages or obligations.

Question 43: What is the principle of indemnity?

Making a profit from insurance
Insurance for maximum value
Getting double payment
Insurance should restore the insured to the same financial position as before the loss — no better, no worse (Correct answer)

Correct answer: Insurance should restore the insured to the same financial position as before the loss — no better, no worse

The principle of indemnity means insurance compensates for actual loss but does not allow the insured to profit from a claim.

Question 44: How should you prioritize when handling multiple customer inquiries simultaneously?

Handle them randomly
Handle the easiest ones first
Assess urgency: safety-related and time-sensitive issues first, then complex issues, then routine inquiries (Correct answer)
Only handle one at a time, putting others on hold indefinitely

Correct answer: Assess urgency: safety-related and time-sensitive issues first, then complex issues, then routine inquiries

Prioritizing by urgency ensures that the most critical situations are addressed first while maintaining service quality for all customers.

Question 45: A passage states: 'Claims submitted after the stipulated reporting period will be considered untimely and may be denied.' What does 'stipulated' mean?

Extended upon request
Specified or agreed upon in advance (Correct answer)
Estimated
Determined after investigation

Correct answer: Specified or agreed upon in advance

Stipulated means explicitly stated or established as a condition or requirement within the policy.

Question 46: The following passage appears in a Geico FAQ: 'Comprehensive coverage protects against losses not caused by a collision, such as theft, vandalism, or weather damage.' Which event would NOT be covered under comprehensive?

Your car being stolen from a parking lot
A rear-end collision at a stop sign (Correct answer)
A tree branch falling on your windshield
Hail denting the roof of your car

Correct answer: A rear-end collision at a stop sign

A rear-end collision is a collision event, which falls under collision coverage, not comprehensive coverage.

Question 47: What is a multi-policy discount?

A discount for multiple drivers
A discount for bundling different types of insurance policies (auto + home) with the same company (Correct answer)
A discount for having multiple cars
A discount for paying multiple months at once

Correct answer: A discount for bundling different types of insurance policies (auto + home) with the same company

Multi-policy (or bundling) discounts reward customers who carry multiple types of insurance with the same company, such as auto and homeowners.

Question 48: If an auto insurance premium is $1,200 annually and the customer pays monthly, what is each payment?

$150
$200
$100 (Correct answer)
$120

Correct answer: $100

$1,200 ÷ 12 months = $100 per month. Note: some companies add a monthly billing fee.

Question 49: What factors typically affect auto insurance premiums?

Only your zip code
Only the car model
Driving record, age, location, vehicle type, coverage levels, credit score, and mileage (Correct answer)
Only your age

Correct answer: Driving record, age, location, vehicle type, coverage levels, credit score, and mileage

Insurance premiums are calculated using multiple risk factors including your driving history, demographics, where you live, what you drive, and how much coverage you want.

Question 50: If switching from a $250 to a $500 deductible saves $120/year on premiums, how long to recoup the extra $250 risk?

About 3 years
About 2 years (Correct answer)
About 1 year
About 5 years

Correct answer: About 2 years

Extra risk = $500 - $250 = $250. Annual savings = $120. Time to recoup = $250 ÷ $120 ≈ 2.08 years.

Question 51: An agent's sales target is 50 policies per month. They sold 42 in the first 3 weeks. What is their completion rate?

92%
84% (Correct answer)
42%
100%

Correct answer: 84%

Completion rate = 42/50 × 100% = 84%. They need 8 more policies in the remaining week.

Question 52: A Geico policy document states: 'Coverage applies unless the insured vehicle is used for commercial purposes without endorsement.' What does this mean for a driver who uses their personal car to deliver food on weekends?

Coverage is fully valid since weekends are not business days
Coverage applies only if the driver notifies Geico after each delivery
Coverage is automatically extended to all part-time commercial activities
Coverage may be denied because the vehicle is used for commercial purposes without an endorsement (Correct answer)

Correct answer: Coverage may be denied because the vehicle is used for commercial purposes without an endorsement

The clause explicitly excludes commercial use without an endorsement, so food delivery — a commercial activity — could void coverage.

Question 53: How should you handle a customer who is comparing GEICO rates with a competitor?

Highlight GEICO's value proposition including coverage quality, service, and potential discounts (Correct answer)
Badmouth the competitor
Refuse to discuss competitors
Tell them to go to the competitor

Correct answer: Highlight GEICO's value proposition including coverage quality, service, and potential discounts

Focusing on GEICO's strengths — quality coverage, excellent service, and available discounts — demonstrates value without negative competitor tactics.

Question 54: If a customer's claim history shows 2 claims in 5 years, what is their claim frequency rate?

0.4 claims per year (Correct answer)
0.2 claims per year
2.5 claims per year
1 claim per year

Correct answer: 0.4 claims per year

Claim frequency = 2 claims ÷ 5 years = 0.4 claims per year.

Question 55: A customer wants to add a teenage driver to their policy. What information is most relevant?

The parent's driving record
The teenager's age, driving record, grades (for good student discount), and vehicle they will drive (Correct answer)
Only the teenager's name
The teenager's favorite color

Correct answer: The teenager's age, driving record, grades (for good student discount), and vehicle they will drive

Rating a teenage driver requires specific information about their driving experience, any available discounts (good student, driver training), and the vehicle they will use.

Question 56: What is the purpose of continuing education in a profession?

To maintain and expand knowledge, meet licensing requirements, and stay competitive in the field (Correct answer)
To collect certificates
To increase tuition revenue for schools
It is only for new professionals

Correct answer: To maintain and expand knowledge, meet licensing requirements, and stay competitive in the field

Continuing education ensures professionals maintain current knowledge, meet regulatory requirements, and develop new skills for career advancement.

Question 57: In a Geico policy summary, 'endorsement' is listed as an add-on. What does an endorsement do?

It transfers the policy to another person
It cancels a portion of the existing coverage
It replaces the entire policy with a new one
It modifies or adds coverage to a standard policy (Correct answer)

Correct answer: It modifies or adds coverage to a standard policy

An endorsement (or rider) is a written amendment that changes or expands the terms of a base insurance policy.

Question 58: How do you evaluate the quality of your professional work?

By measuring against established standards, gathering feedback, tracking outcomes, and comparing to best practices (Correct answer)
Quality does not matter if the work is done
By how fast you complete it
Only clients evaluate quality

Correct answer: By measuring against established standards, gathering feedback, tracking outcomes, and comparing to best practices

Quality evaluation uses multiple metrics including professional standards, client satisfaction, outcome measurement, and comparison with industry best practices.

Question 59: What is the safest following distance to maintain behind the car ahead under good conditions?

One car length
As close as possible to save fuel
At least 3 seconds (Correct answer)
Half a second

Correct answer: At least 3 seconds

The three-second rule gives enough time to react and brake safely under normal conditions.

Question 60: Which coverage pays for damage to YOUR car from a collision regardless of fault?

Medical payments only
Uninsured motorist coverage
Collision coverage (Correct answer)
Liability coverage

Correct answer: Collision coverage

Collision coverage repairs your own vehicle after an accident regardless of fault.

Question 61: It is distracting to talk on your phone while driving while using Bluetooth or the hands-free feature.

False
True (Correct answer)

Correct answer: True

Even with Bluetooth or hands-free devices, talking on the phone while driving is considered distracting because it diverts cognitive attention from the road. The mental engagement required for a conversation reduces a driver's ability to react quickly to hazards, regardless of whether their hands are on the wheel.

GEICO Employment Assessment Test

The GEICO Employment Assessment Test is used by GEICO (Government Employees Insurance Company) to evaluate candidates for customer service, claims, sales, and corporate roles. The assessment measures verbal reasoning, numerical reasoning, situational judgment, problem-solving aptitude, and knowledge of insurance concepts. Strong performance helps candidates advance in GEICO's hiring process for entry-level and professional positions.

Questions

60 min

Time Limit

70%

To Pass

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