Buying BRK.B to save $94 annually on insurance?

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BogleMelon
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Buying BRK.B to save $94 annually on insurance?

Post by BogleMelon » Thu Apr 19, 2018 1:06 pm

Inspired by this post I think now to sell around $210 worth of my Total Stock index fund (setting in my Vanguard Roth IRA) and buy an individual 1 share of BRK.B so only get Geico discount.

I only have Auto insurance with them (renter insurance is through another company that is way cheaper), so i asked them on how much I would save, they said "$47/6 months" or roughly 7% of my current premium.

My thoughts:
Cons:
- It would take about a whole 2.5 years to break even with the cost of the share (including Vanguard commission)

Pros:
- I still have the share that could appreciate and/or pay dividends during this period, so I shouldn't really look at the break even, I am not completly wasting the $200 bucks after all to just buy the discount.
- No taxes complications since it is my Roth IRA

Would you do it? Does it worth it?
Last edited by BogleMelon on Thu Apr 19, 2018 2:02 pm, edited 1 time in total.
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

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triceratop
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Re: Buying BRK.B to save $94 annually on insurance?

Post by triceratop » Thu Apr 19, 2018 1:08 pm

I did it. The true cost was the $7.00 commission I paid to Vanguard to buy one share (I now no longer pay commissions, so if I need to sell it there is no cost). Since my purchase, BRK.B has outperformed Total Stock Market so I have a hard time viewing the share price as an expense.

This is a no-brainer.
"To play the stock market is to play musical chairs under the chord progression of a bid-ask spread."

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msi
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Re: Buying BRK.B to save $94 annually on insurance?

Post by msi » Thu Apr 19, 2018 1:56 pm

Go for it. Besides the discount, I have a small capital gain from doing this when I switched to GEICO a couple years ago.

mikebee
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Re: Buying BRK.B to save $94 annually on insurance?

Post by mikebee » Thu Apr 19, 2018 2:38 pm

BogleMelon wrote:
Thu Apr 19, 2018 1:06 pm
Inspired by this post I think now to sell around $210 worth of my Total Stock index fund (setting in my Vanguard Roth IRA) and buy an individual 1 share of BRK.B so only get Geico discount.

I only have Auto insurance with them (renter insurance is through another company that is way cheaper), so i asked them on how much I would save, they said "$47/6 months" or roughly 7% of my current premium.

My thoughts:
Cons:
- It would take about a whole 2.5 years to break even with the cost of the share (including Vanguard commission)

Pros:
- I still have the share that could appreciate and/or pay dividends during this period, so I shouldn't really look at the break even, I am not completly wasting the $200 bucks after all to just buy the discount.
- No taxes complications since it is my Roth IRA

Would you do it? Does it worth it?
Be careful. We had an A share and we were refused any discount because our "existing discounts" exceeded the Gieko shareholder discount. ie the latter is not an extra discount over and above the discounts you already have. Best to check first with your Geiko agent before investing.
Left us with a nasty feeling about Mr Buffet but I guess that's how he got to be a billionaire.

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EngCapt1
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Re: Buying BRK.B to save $94 annually on insurance?

Post by EngCapt1 » Thu Apr 19, 2018 2:45 pm

BogleMelon wrote:
Thu Apr 19, 2018 1:06 pm
Pros:
- I still have the share that could appreciate and/or pay dividends during this period

It may appreciate, but Berkshire doesn't pay a dividend.

BogleMelon
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Re: Buying BRK.B to save $94 annually on insurance?

Post by BogleMelon » Thu Apr 19, 2018 2:47 pm

EngCapt1 wrote:
Thu Apr 19, 2018 2:45 pm
BogleMelon wrote:
Thu Apr 19, 2018 1:06 pm
Pros:
- I still have the share that could appreciate and/or pay dividends during this period

It may appreciate, but Berkshire doesn't pay a dividend.
It is good to know, thanks
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

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EngCapt1
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Re: Buying BRK.B to save $94 annually on insurance?

Post by EngCapt1 » Thu Apr 19, 2018 2:57 pm

BogleMelon wrote:
Thu Apr 19, 2018 2:47 pm
EngCapt1 wrote:
Thu Apr 19, 2018 2:45 pm
BogleMelon wrote:
Thu Apr 19, 2018 1:06 pm
Pros:
- I still have the share that could appreciate and/or pay dividends during this period

It may appreciate, but Berkshire doesn't pay a dividend.
It is good to know, thanks
That should be listed as one of your "Pros" if you own it in your taxable account. You will probably never pay a penny in taxes on it until you sell it.

WhiteMaxima
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Re: Buying BRK.B to save $94 annually on insurance?

Post by WhiteMaxima » Thu Apr 19, 2018 3:18 pm

How do you let GEICO know that you have BRKA/B? I have mutual fund which has significant % of BRKA, does it count?

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JoMoney
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Re: Buying BRK.B to save $94 annually on insurance?

Post by JoMoney » Thu Apr 19, 2018 3:24 pm

As others mentioned, you may find out you have other discounts (good driver, job, group membership, etc..) that give you a better discount and can't be stacked with this.
Also, I've heard it reported that people who own BRK via mutual funds (it's already in TSM) have claimed the discount without directly holding the shares. I don't know what their specific ownership requirements are, but owning in a brokerage account would be in 'street name' and not really directly owning a share either.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

BogleMelon
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Re: Buying BRK.B to save $94 annually on insurance?

Post by BogleMelon » Thu Apr 19, 2018 3:33 pm

WhiteMaxima wrote:
Thu Apr 19, 2018 3:18 pm
How do you let GEICO know that you have BRKA/B? I have mutual fund which has significant % of BRKA, does it count?
According to Geico email to me:
In order to apply the discount, we must receive documentation showing the purchase of a full share of stock.
So I think mutual funds don't count, however I read somewhere here that another poster were able to do it, that was a post from years ago though..
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

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JoMoney
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Re: Buying BRK.B to save $94 annually on insurance?

Post by JoMoney » Thu Apr 19, 2018 3:41 pm

BogleMelon wrote:
Thu Apr 19, 2018 3:33 pm
... however I read somewhere here that another poster were able to do it, that was a post from years ago though..
I've read that elsewhere, actually I've read that they don't request verification... I wonder how they would even do that for someone that owned in a brokerage account, would you have to provide them a recent copy of your brokerage account statement ?
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

BogleMelon
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Re: Buying BRK.B to save $94 annually on insurance?

Post by BogleMelon » Thu Apr 19, 2018 3:47 pm

JoMoney wrote:
Thu Apr 19, 2018 3:41 pm
BogleMelon wrote:
Thu Apr 19, 2018 3:33 pm
... however I read somewhere here that another poster were able to do it, that was a post from years ago though..
I've read that elsewhere, actually I've read that they don't request verification... I wonder how they would even do that for someone that owned in a brokerage account, would you have to provide them a recent copy of your brokerage account statement ?
I will just send them the Vanguard brokerage confirmation pdf that I would get once the transaction is settled tomorrow. I think that should do it
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

mortalsonofmortal
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Re: Buying BRK.B to save $94 annually on insurance?

Post by mortalsonofmortal » Thu Apr 19, 2018 4:15 pm

I called customer support and told them I had a Berkshire share and I want a discount. They immediately applied the discount no questions asked. Never had to submit any papers.

neilpilot
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Re: Buying BRK.B to save $94 annually on insurance?

Post by neilpilot » Thu Apr 19, 2018 4:16 pm

mortalsonofmortal wrote:
Thu Apr 19, 2018 4:15 pm
I called customer support and told them I had a Berkshire share and I want a discount. They immediately applied the discount no questions asked. Never had to submit any papers.
Same here. I didn't even have to buy a share. :twisted:

JBTX
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Re: Buying BRK.B to save $94 annually on insurance?

Post by JBTX » Thu Apr 19, 2018 4:36 pm

neilpilot wrote:
Thu Apr 19, 2018 4:16 pm
mortalsonofmortal wrote:
Thu Apr 19, 2018 4:15 pm
I called customer support and told them I had a Berkshire share and I want a discount. They immediately applied the discount no questions asked. Never had to submit any papers.
Same here. I didn't even have to buy a share. :twisted:
Same here. First they said I wasn’t eligible due to a college association discount, but then she checked again and said it did apply which was about $21 additional discount every six months.

Also I asked for other discounts and she sent me info for online driver safety course that costs $20 and saves $11 every 6 months and lasts 3 years. 4 hrs of time for $44 savings over 3 years. Not very lucrative on a per hour basis. Applies only to drivers over 50.

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Re: Buying BRK.B to save $94 annually on insurance?

Post by bob60014 » Thu Apr 19, 2018 5:10 pm

I just called and asked for discount, it was granted immediately, no docs required.

BogleMelon
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Re: Buying BRK.B to save $94 annually on insurance?

Post by BogleMelon » Thu Apr 19, 2018 6:07 pm

Thank you all, I did that too and got the discount. I think Geico agents are now wondering why all these calls today for people who claim to be holder of BRK?!
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

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whodidntante
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Re: Buying BRK.B to save $94 annually on insurance?

Post by whodidntante » Thu Apr 19, 2018 6:39 pm

mikebee wrote:
Thu Apr 19, 2018 2:38 pm

Be careful. We had an A share and we were refused any discount because our "existing discounts" exceeded the Gieko shareholder discount. ie the latter is not an extra discount over and above the discounts you already have.
With an A share, call and ask for Warren.

WhiteMaxima
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Re: Buying BRK.B to save $94 annually on insurance?

Post by WhiteMaxima » Thu Apr 19, 2018 7:23 pm

whodidntante wrote:
Thu Apr 19, 2018 6:39 pm
mikebee wrote:
Thu Apr 19, 2018 2:38 pm

Be careful. We had an A share and we were refused any discount because our "existing discounts" exceeded the Gieko shareholder discount. ie the latter is not an extra discount over and above the discounts you already have.
With an A share, call and ask for Warren.
how mush an A share worth now? I almost bought one share at $160000 four years ago but I deside in the 3 vanguard fund BH investment. Seems BRKA performed in par with VT. In taxable account , I will definite own BRKA/B. Vanguard fund still pays dividend and cap gain tax.

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whodidntante
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Re: Buying BRK.B to save $94 annually on insurance?

Post by whodidntante » Thu Apr 19, 2018 7:27 pm

WhiteMaxima wrote:
Thu Apr 19, 2018 7:23 pm
whodidntante wrote:
Thu Apr 19, 2018 6:39 pm
mikebee wrote:
Thu Apr 19, 2018 2:38 pm

Be careful. We had an A share and we were refused any discount because our "existing discounts" exceeded the Gieko shareholder discount. ie the latter is not an extra discount over and above the discounts you already have.
With an A share, call and ask for Warren.
how mush an A share worth now? I almost bought one share at $160000 four years ago but I deside in the 3 vanguard fund BH investment. Seems BRKA performed in par with VT. In taxable account , I will definite own BRKA/B. Vanguard fund still pays dividend and cap gain tax.
About 36 bitcoins. :)

NoHeat
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Re: Buying BRK.B to save $94 annually on insurance?

Post by NoHeat » Thu Apr 19, 2018 11:36 pm

At Berkshire’s annual shareholders meeting, which I have attended about 15 times, GEICO has a giant booth staffed by lots of sales agents brought to the event from around the country as a reward for top performance. They are very knowledgeable and friendly.

The GEICO quote offered no savings for me when I tried it. But I do enjoy posing every year with the gecko (another sales agent, in costume) for a souvenir photo that I always keep on the fridge.

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Tamarind
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Re: Buying BRK.B to save $94 annually on insurance?

Post by Tamarind » Fri Apr 20, 2018 6:54 am

I would hunt around for cheaper insurance first. You might be able to get a better deal elsewhere, removing the need to buy the shares.

SimonJester
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Re: Buying BRK.B to save $94 annually on insurance?

Post by SimonJester » Fri Apr 20, 2018 7:26 am

Tamarind wrote:
Fri Apr 20, 2018 6:54 am
I would hunt around for cheaper insurance first. You might be able to get a better deal elsewhere, removing the need to buy the shares.
+1 I just quoted 12 different insurance companies with identical coverage selected for Home & Auto. Sorry but the lizard was the 2nd highest of them all :(
Last edited by SimonJester on Sat Apr 21, 2018 8:55 am, edited 1 time in total.
"They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety." - Benjamin Franklin

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Re: Buying BRK.B to save $94 annually on insurance?

Post by neilpilot » Fri Apr 20, 2018 7:30 am

SimonJester wrote:
Fri Apr 20, 2018 7:26 am
Tamarind wrote:
Fri Apr 20, 2018 6:54 am
I would hunt around for cheaper insurance first. You might be able to get a better deal elsewhere, removing the need to buy the shares.
+1 I just quoted 12 different insurance companies with identical coverage selected for Home & Auto. Sorry but the lizard was the highest of them all :(
Of course you know that Geico doesn't underwrite homeowners insurance.

My auto & umbrella is with them, and they were the lowest auto rate of all my quotes and remain lowest 2 years later. My home is insured thru a different company.

sco
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Re: Buying BRK.B to save $94 annually on insurance?

Post by sco » Fri Apr 20, 2018 11:28 pm

neilpilot wrote:
Fri Apr 20, 2018 7:30 am
SimonJester wrote:
Fri Apr 20, 2018 7:26 am
Tamarind wrote:
Fri Apr 20, 2018 6:54 am
I would hunt around for cheaper insurance first. You might be able to get a better deal elsewhere, removing the need to buy the shares.
+1 I just quoted 12 different insurance companies with identical coverage selected for Home & Auto. Sorry but the lizard was the highest of them all :(
Of course you know that Geico doesn't underwrite homeowners insurance.

My auto & umbrella is with them, and they were the lowest auto rate of all my quotes and remain lowest 2 years later. My home is insured thru a different company.

Yeah putting them together to save money, that really isn't something that net's out sometimes. You have to shop for them separately. My Home is with someone else too, and it is by far cheaper to do it this way than any other combination possible.

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Re: Buying BRK.B to save $94 annually on insurance?

Post by boglerdude » Sat Apr 21, 2018 12:31 am

SimonJester wrote:
Fri Apr 20, 2018 7:26 am
I just quoted 12 different insurance companies with identical coverage selected for Home & Auto. Sorry but the lizard was the highest of them all :(
Please rank the results...

BogleMelon
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Re: Buying BRK.B to save $94 annually on insurance?

Post by BogleMelon » Sat Apr 21, 2018 6:33 am

Tamarind wrote:
Fri Apr 20, 2018 6:54 am
I would hunt around for cheaper insurance first. You might be able to get a better deal elsewhere, removing the need to buy the shares.
In my state (NJ), AAA would be almost always a cheaper insurance option, however I heard bad stories about them when it comes to claims.
I already check other companies from time to time, and so far Geico is the second cheapest
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Re: Buying BRK.B to save $94 annually on insurance?

Post by SimonJester » Sat Apr 21, 2018 8:57 am

boglerdude wrote:
Sat Apr 21, 2018 12:31 am
Please rank the results...
Understand that location, coverage selected, deductibles and your risk rating change all of this. So you have to quote your own situation and policy to see where they rank for you. Amica was the 2nd lowest for me this year so I went with Amica
"They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety." - Benjamin Franklin

seawolf21
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Re: Buying BRK.B to save $94 annually on insurance?

Post by seawolf21 » Sat Apr 21, 2018 9:11 am

I have Geico a call and they inform me association discounts are the same as the shareholder discount. Anybody had association discount and switched to shareholder discount?

WhiteMaxima
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Re: Buying BRK.B to save $94 annually on insurance?

Post by WhiteMaxima » Wed Apr 25, 2018 2:43 pm

Gave GEICO a call last night and got -$7 savings for 6 months.

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