GEICO Implements Significant Workforce Reduction as Part of Restructuring
Berkshire Hathaway’s auto insurance subsidiary, GEICO, has dramatically reduced its workforce by more than half as it continues a comprehensive turnaround effort. This move reflects broader changes sweeping through the insurance industry as companies adapt to evolving market conditions and technological advancements.
According to Ajit Jain, Vice Chair of Insurance Operations at Berkshire Hathaway, GEICO’s employee count has been slashed from approximately 50,000 to around 20,000. While specific dates for the reductions weren’t provided, the significant cutbacks come after years of the company underperforming relative to its competitors.
Recent financial results, however, indicate that GEICO is showing signs of recovery. In the first quarter of 2025, the company reported $2.2 billion in pretax underwriting earnings, representing a 13% increase from the same period in 2024. This improvement is backed by Bloomberg’s report, which highlights GEICO’s rebounding customer growth following a period of market share loss.
The successful restructuring efforts, led by GEICO CEO Todd Combs, have focused on implementing stringent cost controls and modernizing operations. Jain credited Combs with steering these changes, though he cautioned against complacency, stating, “I do not want to be so arrogant to say ‘mission accomplished.'” Jain emphasized the need for GEICO to prioritize artificial intelligence to maintain competitiveness in the rapidly evolving insurance landscape.
GEICO’s transformation is part of a larger industry trend toward automation and AI adoption. Numerous insurance firms have introduced new digital underwriting platforms and claims processing systems in recent months to reduce costs and enhance accuracy.
The workforce reduction follows earlier cutbacks in 2023 when GEICO laid off about 2,000 employees, or roughly 6% of its workforce. By mid-2024, the company’s employee count had dwindled further to 28,247, marking a 33% reduction from its 2020 peak. These cuts align with similar actions taken by other major insurers, including Farmers Insurance, State Farm, and Allstate, which scaled back operations in various states due to concerns over natural disasters, inflation, and rising property repair costs.
Contrasting with the layoffs, GEICO has also been pursuing expansion efforts. In March 2025, the company announced plans to open a second office in Richardson, Texas, creating over 1,000 new jobs. This move is designed to enhance the company’s sales, service, and claims operations in the region, demonstrating a balanced approach to restructuring and growth.
As the insurance industry continues to evolve, GEICO’s dual strategy of workforce optimization and targeted expansion positions the company for potential long-term success while navigating the challenges of technological disruption and market competition.
